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Newfoundland Throne Speech stresses fiscal prudence

Fiscal restraint loomed large even in oil-rich Newfoundland and Labrador as the legislature opened Monday with a throne speech stressing the need to act now to protect future prosperity.

Lt.-Gov. John Crosbie delivered Premier Kathy Dunderdale's blueprint for a financially prudent new session led by a third straight Tory majority government elected last October.

He began with a moment of silence for 14-year-old Burton Winters, whose recent death in Labrador sparked renewed demands for better search and rescue response.

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The speech underscored the need to make choices now to ensure new-found prosperity continues for generations to come.

"If we squander opportunities by making short-sighted decisions today, it is our children and our grandchildren who will reap the consequences," Ms. Dunderdale told the legislature.

Recent big-spending budgets that invested in health care, social programs and construction relied heavily on offshore oil and mineral profits.

Ms. Dunderdale recently signalled in a speech to the St. John's Board of Trade that the province must rein in spending and cut debt.

Years of fiscal surpluses over most of the past decade are about to give way to two years of predicted deficits as offshore oil production dips due to refits and maintenance.

Ms. Dunderdale has ruled out tax hikes and program cuts, but instructed departments to trim costs by becoming more efficient.

She also wants to bring down per capita debt – the highest in Canada – to the national average within 10 years.

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Total provincial debt is estimated at about $7.7-billion this year, down from a high of $12-billion eight years ago.

Late last year, Finance Minister Tom Marshall predicted deficits of about $400-million for 2012-13 and $211-million in 2013-14.

"Whether we are talking about 30 years from now, or two years from now, the future we reap will be determined by the seeds we sow – the choices we make – right here, right now," Mr. Crosbie read from the throne speech.

"We will not allow poor choices based on failed philosophies and narrow agendas to reverse every gain we have worked so hard to achieve."

The throne speech casts the proposed $6.2-billion Muskrat Falls hydroelectric project in Labrador as a crucial means to develop renewable energy. Opposition critics and a growing list of former public servants and lawyers – including former Tory premier Brian Peckford – have raised doubts.

They fear the plan to bring hydro from Labrador to Newfoundland and then Nova Scotia using subsea cables is prone to cost overruns. They're not convinced the province has thoroughly studied other options.

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The issue will likely dominate the new legislative session, but the throne speech makes the government's position clear as it prepares to decide this spring whether to approve Muskrat Falls.

"In the decades to come, there will be sufficient renewable energy in Labrador to fuel unprecedented growth throughout our province," Mr. Crosbie read.

"The best is yet to come."

The throne speech also promises a range of targeted health and social investments, despite a declining percentage of health funding from Ottawa.

They include spending to improve long-term care and legislation to lower what many patients pay for generic drugs.

The province is also improving supports for foster parents as it works to streamline adoption.

Major planned projects including Muskrat Falls, the Hebron offshore oilfield and expanding iron ore production in Labrador will require more skilled workers, Mr. Crosbie said.

The government is creating a workforce development secretariat to link workers with job opportunities as it expands efforts to increase apprenticeships and gender equity.

"While we will work vigorously to ensure Newfoundlanders and Labradorians benefit first and fully from these employment opportunities, other workers will also be required," Mr. Crosbie said.

"As people move here from outside the province to meet labour market needs, we will welcome them with open arms, encourage them to sink down deep roots and make Newfoundland and Labrador their home."

Liberal Opposition Leader Dwight Ball was heckled as he accused the government of an accountability deficit during his response to the speech in the House of Assembly.

The legislature sat for just 33 days in the past 14 months, leaving the opposition to raise questions in news releases or through social media such as Twitter.

Mr. Ball said the government has stonewalled access-to-information requests, labelled critics as traitors, and blocked the provincial auditor general from documents needed to trace spending decisions linked to a $5-billion industry strategy.

"The people of the province expect better of their elected representatives," Ball said.

NDP Leader Lorraine Michael said the throne speech fails to meet child care, housing and other social needs.

"This is something I'm absolutely appalled by," she said of the government's silence on a promised child care strategy.

Alex Marland, a political scientist at Memorial University of Newfoundland, said he's not sure how the province is going to pay for the limited social spending mentioned in the throne speech.

Fiscal management "is definitely a feature," he said of the government's new focus.

"It's really tough because on the one hand they're saying we're going to do all these things – a strong social agenda and we're going to be very progressive. And yet at the same time, they're saying there's going to be less money coming in from Ottawa, there's going to be less money coming in from oil.

"We're going to have less money to do it all."

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