The Saskatchewan government closed the 2025-26 fiscal year with a deficit approaching $1 billion, according to figures released by the province on June 30, 2026. The shortfall marks a significant deviation from earlier budget projections and underscores ongoing fiscal pressures.
Deficit Details
The final deficit for the fiscal year ending March 31, 2026, was reported at $988 million, slightly less than the $1.02 billion forecast in the mid-year update. Revenue fell short of expectations due to lower-than-anticipated resource revenues and slower economic growth, while spending increased in health care and education.
Finance Minister Jim Reiter attributed the deficit to global economic headwinds and lower potash and oil prices. “We are not immune to global factors, but our economy remains fundamentally strong,” Reiter said in a statement. The province’s total revenue was $18.2 billion, down from the budgeted $18.7 billion, while expenses rose to $19.2 billion.
Impact on Provincial Debt
The deficit adds to Saskatchewan’s net debt, which now stands at $15.6 billion. The debt-to-GDP ratio increased to 12.8%, still among the lowest in Canada. Credit rating agencies have maintained Saskatchewan’s AAA rating, citing prudent fiscal management.
Opposition NDP finance critic Trent Wotherspoon criticized the government for failing to diversify the economy. “This deficit shows the risk of relying too heavily on volatile resource revenues,” Wotherspoon said. He called for increased investment in renewable energy and technology sectors.
Spending Highlights
Health care spending rose 5.2% to $7.1 billion, driven by higher wages and increased demand for services. Education spending increased 3.8% to $3.4 billion, including funding for new schools and teacher hiring. Infrastructure investment totaled $2.5 billion, focused on highways and water projects.
The government also allocated $200 million for drought relief and agricultural support, as dry conditions affected crop yields across the province. Agriculture Minister David Marit noted that the sector faced “one of the most challenging growing seasons in recent memory.”
Outlook for 2026-27
The province’s budget for the current fiscal year, tabled in April 2026, projects a return to surplus of $150 million, assuming moderate economic growth and stable commodity prices. However, economists caution that global uncertainties, including trade disruptions and inflation, could affect those forecasts.
The Saskatchewan government plans to release its first-quarter fiscal update in September 2026.
