New Brunswick's 2025 Budget: Priority Spending Takes Precedence Over Fiscal Balance

The Province of New Brunswick presented its 2025-26 budget on March 18, 2025. Following general elections in October 2024, promised increases in spending are leading to deficits and higher net debt than previously planned. The budget does not indicate a return to balance over the medium term. It powers up spending to address service and infrastructure needs, while carving out support funds to bolster economic development over a longer term.

Key Highlights
-- Economic momentum will remain supported by population growth and business investment, though trade uncertainty could present downward pressure.
-- Budget points to deficits through 2028-29 as the government prioritizes key spending themes.
-- Deficit forecast and sizable capital needs will push up debt-to-GDP, although this is still considered manageable for the current ratings.

Aditi Joshi, Vice President, Global Sovereign Ratings, said "Similar to peer jurisdictions, New Brunswick's credit outlook remains clouded by broader economic and trade uncertainty. While some financial erosion is likely and will reduce flexibility within the current ratings, we note that there is still room to absorb modest temporary deterioration without any adverse impact on the credit rating."