ST. JOHN'S, N.L. - Newfoundland and Labrador will trim government jobs and cut the size of the premier's cabinet in a $7.6-billion budget tabled today as the province faces a deficit of $563.8 million in the 2013-14 fiscal year.
The deficit is on top of a shortfall of almost $431 million for this fiscal year as net debt grows almost $1 billion to $9.5 billion next year.
The numbers are better than recent warnings that the province was facing cumulative deficits that could total almost $4 billion as world economic troubles cut demand for the province's oil and minerals.
Instead, the province is forecasting a deficit of $650.5 million in 2014-15, for a total of just over $1.2 billion in the next two fiscal years.
Finance Minister Jerome Kennedy says higher oil production, cost-cutting and an increased sales tax refund from Ottawa helped reduce the anticipated shortfall.
The province is trimming about 1,200 government jobs through layoffs and cutting vacant positions, and has approved another 200 early retirements.
The budget does not raise personal or corporate income taxes and predicts a surplus of just over $230 million in 2015-16.
Premier Kathy Dunderdale will take on intergovernmental duties as she cuts one cabinet minister and blends Labrador and aboriginal affairs into one post.