Saskatchewan is the place where people want to be. The Parliamentary Budget Office says Saskatchewan is projected to have one of the highest population growth rates in Canada, and a relatively young population over the long term. The Office says, favourable demographic trends combined with above-average labour productivity growth and the expectation is that Saskatchewan will have the highest projected provincial real GDP growth rate in Canada, except for Alberta.

On the down side, the PBO says Saskatchewan’s current fiscal policy is not sustainable over the long term. Permanent tax increases or spending reductions amounting to 4.0 per cent of GDP would be required to stabilize government net debt (as a share of the economy) in the long term.

The Office says Saskatchewan currently spends less on health care, as a share of the provincial economy, than any other province, except for British Columbia. Combined with relatively modest pressures from population ageing, the province’s health care costs are projected to remain below the current outlays of some other provinces.
The PBO says our sustainability prospects are helped by what it assumes will be a comparatively favourable differential between long-run effective interest rates and economic growth.

Three provinces have rosy outlooks: Ontario, Quebec, and Nova Scotia.
Ontario can expect lower long-term effective interest rates. Modest permanent tax decreases or spending increases amounting to less than 0.1 per cent of GDP are possible.

In Quebec, provincial revenues exceed program spending throughout the PBO projection. Federal transfer revenues are projected to remain relatively stable, with modest increases to Equalization entitlements relative to the current year. Permanent tax decreases or spending increases amounting to 1.1 per cent of GDP would be possible.

In Nova Scotia, real GDP growth is below the national average. Nova Scotia currently spends more on health care, as a share of the provincial economy, than any other province. The province is forecasting a return to budget surpluses. Modest, permanent tax decreases or spending increases amounting to 0.2 per cent of GDP would be possible.

Interestingly, Quebec and Nova Scotia, both have the potential of tax decreases, yet these two provinces receive billions of dollars in equalization payments from Canadian taxpayers: $4.461 Billion for Nova Scotia from 2020 to 2022; $26.372 billion for Quebec over the same time period. Ontario, Saskatchewan, and Alberta will get no equalization payments.