P.E.I. projects $129.5M deficit for fiscal year

Prince Edward Island is looking at a nearly $130 million deficit in the coming fiscal year.

The Prince Edward Island government is projecting a $129.5 million deficit for the 2024-2025 fiscal year, a large increase from their initial estimations last year.

In its fiscal and economic update, the government said the projected deficit has increased by $44.5 million since the budget was tabled in February 2024. Last year the deficit was anticipated to be $85 million.

The net debt is expected to increase by $14.4 million less than what was originally expected. The projected revenue is now expected to be $3.14 billion, which is down by $6.5 million from the earlier forecast.

“Though there are challenges, the economic situation on the Island is continuing to normalize as interest rates decline and inflation returns towards the Bank of Canada’s two per cent target,” the update reads. “The Island economy is on track to make the required investments in its growing population, while making progress on balancing population growth with other priorities. On balance, the forecast for real GDP for 2024 has been revised down from 4.1 per cent at Budget to 3.8 per cent due largely to weaker than expected consumer sentiment and slower employment growth.”

The update also noted P.E.I.’s population hit an all-time high of 178,550 last July. Its growth rate of 2.8 per cent is the fourth fastest annual growth in Canada.

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