{"id":606165,"date":"2026-04-15T17:44:12","date_gmt":"2026-04-15T17:44:12","guid":{"rendered":"https:\/\/www.newsbeep.com\/ca\/606165\/"},"modified":"2026-04-15T17:44:12","modified_gmt":"2026-04-15T17:44:12","slug":"a-major-red-flag-some-groups-sound-alarm-over-p-e-i-s-latest-budget-deficit","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/ca\/606165\/","title":{"rendered":"\u2018A major red flag\u2019: Some groups sound alarm over P.E.I.\u2019s latest budget deficit"},"content":{"rendered":"

Prince Edward Island\u2019s latest operating budget<\/a>, which projects another record deficit, is raising alarm among advocacy groups that say the province needs to take a closer look at how it spends money.<\/p>\n

The budget, tabled Tuesday by Finance Minister Jill Burridge, projects a deficit of $410 million for the 2026-27 fiscal year. That\u2019s more than double the $183.9 million deficit originally projected for 2025-26, which is now forecast to reach $449.6 million.<\/p>\n

Devin Drover, Atlantic director and general counsel with the Canadian Taxpayers Federation, said the increase in government borrowing means P.E.I.\u2019s net debt is expected to rise by nearly 20 per cent to $4.5 billion by the end of the current fiscal year.<\/p>\n

\u201cThe budget is a major red flag for taxpayers,\u201d he told CBC\u2019s Island Morning.<\/p>\n

LISTEN | Canadian Taxpayers Federation raises concerns about new budget:<\/p>\n

Island Morning6:54Canadian Taxpayers Federation raises concerns about new budget<\/p>\n

Just a day after the province released its new budget, concerns are already being flagged about how taxpayer dollars are being spent. Devin Drover, Atlantic director and general counsel with the Canadian Taxpayers Federation, joins us to discuss.<\/p>\n

Drover said the province needs a sweeping review of government programs, similar to the review undertaken by the federal Liberal government in the 1990s under then-prime minister Jean Chr\u00e9tien and then-finance minister Paul Martin, which led to billions in savings.<\/p>\n

Burridge, who chairs the province\u2019s cabinet committee on fiscal responsibility and red tape reduction, said Tuesday a comprehensive review will be done.<\/p>\n

Drover said while the province has pointed to population growth as a key driver of spending, P.E.I.\u2019s population growth has been slowing<\/a> even as government spending continues to rise at a faster rate.<\/p>\n

He said each Islander will pay about $1,100 in debt interest charges this year alone, an increase of roughly 17 per cent in just one year.<\/p>\n

Drover noted the province\u2019s plan to keep borrowing over the next three years, with P.E.I.\u2019s net debt projected to reach $5.1 billion by the end of the 2028-29 fiscal year.<\/p>\n

Long-term risks of growing debt<\/p>\n

Drover cautioned that while governments often talk about long-term paths back to a balanced budget, those plans frequently fail to materialize because of changes in government or shifts in the economy.<\/p>\n

If debt and interest costs continue to rise, he said, the province will eventually be forced into difficult trade-offs: either reduced service quality as more revenue is diverted to interest payments, or higher taxes as the government tries to maintain services while carrying a heavier debt load.<\/p>\n

\u201cIt certainly saddles future generations of Islanders if they don’t get this under control,\u201d he said.<\/p>\n

\"\"<\/p>\n

P.E.I. government eliminating electricity rebate program, amid other budget cuts<\/p>\n

The Progressive Conservative government unveiled a 2026-27 operational budget that contained what it called \u201cdifficult decisions.\u201d One of its cost-saving measures is scrapping the P.E.I. Energy Rebate Program, meaning many Islanders can soon expect higher electricity bills. CBC\u2019s Wayne Thibodeau explains.<\/p>\n

Drover pointed to New Brunswick<\/a> and Nova Scotia<\/a>, both of which have faced credit downgrades tied to deficit concerns and rising borrowing. He warned a similar downgrade for P.E.I. could be possible.<\/p>\n

\u201cIf your credit gets downgraded, the cost of borrowing goes up. So it’ll be even more money that Islanders pay, that we siphoned away for being used towards essential services and instead being used to really just pay for the dead interest charges.\u201d<\/p>\n

\u2018The deficits today are the taxes of tomorrow\u2019<\/p>\n

Fr\u00e9d\u00e9ric Gionet, the director of the Canadian Federation of Independent Business in Atlantic Canada, said there are some positive signs in the budget.<\/p>\n

The province said exports grew by eight per cent in 2025 despite uncertainty around trade with the U.S., making P.E.I. the only province to post growth in that market.<\/p>\n

\"FredericFr\u00e9d\u00e9ric Gionet, the director of the Canadian Federation of Independent Business in Atlantic Canada, says that business confidence on P.E.I. is currently under pressure due to rising costs. (Canadian Federation of Independent Business)<\/p>\n

Gionet said the budget\u2019s focus on affordability measures could indirectly help small businesses by easing some labour pressures.<\/p>\n

But he said there are no major new investments aimed specifically at helping Island businesses reduce the cost of doing business in the province.<\/p>\n

The CFIB is also worried about the province\u2019s growing deficits. Gionet said business confidence is already under pressure because of rising fuel prices and increasing costs, including higher minimum wages<\/a>.<\/p>\n

\u201cThe deficits today are the taxes of tomorrow,\u201d he said. \u201cIt’s a yellow sign, you know, and possibly a red flag, but they’re not alone.\u201d<\/p>\n

LISTEN | Canadian Taxpayers Federation raises concerns about new budget:<\/p>\n

Island Morning6:54Canadian Taxpayers Federation raises concerns about new budget<\/p>\n

Just a day after the province released its new budget, concerns are already being flagged about how taxpayer dollars are being spent. Devin Drover, Atlantic director and general counsel with the Canadian Taxpayers Federation, joins us to discuss.<\/p>\n

Gionet hopes the fiscal responsibility committee chaired by Burridge will identify government waste and find efficiencies while keeping the focus on core services.<\/p>\n

He said that may not bring immediate relief for businesses but could eventually create more favourable conditions, including the potential for lower taxes.<\/p>\n

\u201cIt won’t solve anything short term, but it sets the course for the province to be competitive.\u201d<\/p>\n

Child-care sector welcomes funding<\/p>\n

Meanwhile, some sectors welcomed specific investments in the budget.<\/p>\n

Jennifer Nangreaves, executive director of the Early Childhood Development Association of P.E.I., said the organization is pleased the budget includes $81.6 million to continue the $10-a-day child-care program.<\/p>\n

\u201cIn other jurisdictions, this is not the case. There’s been some provinces and territories that saw that was a way to save money, and so we were very pleased that the [$10-per-day child care] is protected for families,\u201d she said.<\/p>\n

\"AJennifer Nangreaves, executive director of the Early Childhood Development Association of P.E.I., says the organization wants to see a sustained long-term investment in wages for early childhood educators. (Early Childhood Development Association of P.E.I.)<\/p>\n

Nangreaves also welcomed the budget\u2019s $4.2 million investment to create 400 new early learning spaces.<\/p>\n

But she said expanding access will not succeed without a parallel focus on the workforce.<\/p>\n

The budget includes $990,000 to improve wages for early childhood educators, but Nangreaves said she would like to see something more than a one-time increase.<\/p>\n

\u201cWe have been asking for that to be a predictable, sustained investment,\u201d she said. \u201cThe system can’t continue to grow without a strong workforce. And so we were hoping to see more of a long term commitment.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"Prince Edward Island\u2019s latest operating budget, which projects another record deficit, is raising alarm among advocacy groups that…\n","protected":false},"author":2,"featured_media":606166,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[45,49,48,46],"class_list":["post-606165","post","type-post","status-publish","format-standard","has-post-thumbnail","category-economy","tag-business","tag-ca","tag-canada","tag-economy"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts\/606165","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/comments?post=606165"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts\/606165\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/media\/606166"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/media?parent=606165"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/categories?post=606165"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/tags?post=606165"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}