Saskatchewan is forecasting a $349-million deficit in the first quarter of 2025-2026.
The figure is a significant drop from the slim, $12.1-million surplus the province projected as part of the 2025-2026 budget.
On Friday, Finance Minister Jim Reiter was unconcerned about the new figures as he spoke with media.
“It’s a $21-billion budget. So percentage wise, it’s not huge, but it’s still a significant amount of money. We’re always concerned [but] our fundamentals are still strong,” Reiter said.
The Official Opposition slammed the update in a news conference of their own.
When the budget was presented in March, NDP finance critic Trent Wotherspoon put a copy of the document through a shredder to emphasize his distrust of it — something he echoed on Friday.
“We said from Day 1 that this budget wasn’t worth the paper that it was printed on. Everyone who looks at the results here today will know that that’s the case.The Sask Party passed a budget that they knew was nonsense,” Wortherspoon said.
Reiter defended his government’s approach to the budget. He said the update “underscores” the provincial government’s commitment to striking a balance between affordability, and investing in essential programs and services.
“We’re about to go into budget process. We’re going to sharpen our pencils and look for places to save money, but at the same time we’re not going to do it at the expense of health care, education or the other services that people in Saskatchewan expect,” Reiter said.
Inside the fiscal update
According to the fiscal update, the province’s revenue has dropped by $172 million to $20.9 billion.
Reiter said the drop is due to a decrease in the net income of its Crown corporations, including a $163-million decrease in net income from SaskPower, the province’s primary electricity supplier. That’s mostly due to the federal carbon levy being removed from customers bills in the first quarter, according to the government.
Reiter said the province is continuing to discuss with Ottawa the removal of industrial carbon pricing from the electricity sector.
Non-renewable resources revenue is also forecast to decline by $30 million compared to budget due to lower oil prices and a higher exchange rate.
As part of the 2024/2025 budget, Saskatchewan projected $21 billion in expenses. That’s increased to $21.2 billion in the first quarter update.
The $189-million increase is primarily due to an $80-million increase to address wildfire costs and evacuation efforts, the province said.
The expense is expected to be addressed in a special warrant that will be released on Aug. 25. Wildfires continued in Saskatchewan through the summer, so the final figure could be even larger.
The provincial government has repeatedly relied on special warrants, or injections of funding made outside the regular budget process, to “address cost pressures and respond to emerging issues.”
For instance, $923.1 million in special warrants were issued in February 2025 and $750 million in special warrants were issued in February 2024.
Reiter defended the continued use of special warrants on Friday.
“The special warrants still get full review through the democratic process and it’s just it’s just one way of allowing the financing to continue to provide the service,” he said.
The government said there is also a $115-million increase in its expenses as a result of year-end updates to pension accrual assumptions.
The 2025/2026 budget did not factor in the threat of tariffs from the United States or China and contained no tariff contingencies.
With the situation still fluid, and Canada announcing changes to its policies on Friday, Reiter said he continues to be be optimistic.
“We’ve got to be flexible. We’ve got to see how that turns out. I am hoping at some point in the next few months that a new trade deal is is reached and we can put this behind us,” the finance minister said.
Reiter pointed to Saskatchewan maintaining the highest credit rating among the provinces when the ratings from all three major agencies are considered.
Reiter also pointed to Saskatchewan’s net debt-to-GDP ratio, which is projected to be 14.5 per cent as of March 31, 2026. That’s an increase from the budget and the second-lowest among Canada’s provinces, the government said.
