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John Morris is the founder and owner of morriscode, a leading Prince Edward Island web design & development firm that works with organizations to take advantage of multiple forms of technology and enhance their efficiency through online initiatives.
Occasionally John likes to share thoughts and opinions on his blog. When not working on web design, web development, social media strategies or building new websites, this entrepreneur can be found adventuring through PEI's backwoods capturing the beauty of our province.
I read the budget address thanks to Cynthia Dunsford who was nice enough to give me the government document. In the budget, it stated we are going to be $85.3 million in debt this year which is obviously a large chunk of change.
PEI Budget History
Anyone noticing a pattern here? Since 2003, our province of 140,000 has increased our budgeted debt by $243.1 million dollars over the last 6 years! I am not sure the last time we have had a surplus.
In that time, we have had times where we should have been flying high and times where our economy was in the gutter. Either way, with us accumulating all this debt, our politicians need to stand up and take notice that our province has a spending problem.
I am all for spending and such, but when you're constantly in debt something needs to be done or eventually we will be at the point where most of our money goes towards interest payments. Right now 7.5% (or $114.3 million) of every dollar our government spends ends up being paid on interest charges. Or let's look at this another way. Every time you make a purchase, we pay 10.5% in PST charges. That 10.5% generates $201.80 million a year. If we had no debt, the province would be able to cut our PST almost in half.
While I understand that paying down debt isn't a good idea for government when your in a recession, our good years should be the time we are paying down our debt. Of course, during the recession periods our government should be increasing our expenditures to try and get us out of debt.
I hope as our government moves forward and as our economy recovers that our province takes a good look at our books before announcing new expenditures. If not, our province is going to be in real rough shape in the next 10-20 years.
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