Province's 'savings fund' generates millions in interest

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A $300-million “savings fund” created by the provincial government last year will generate almost $15 million in 2023-2024, and that cash will be used to help some homeowners make energy efficiency upgrades.

In February 2023, the province announced it had created the New Brunswick Advantage Savings Fund, with the aim of generating “investment income that will facilitate the province’s long-term economic growth and sustainability.”

But the money isn’t in “an explicit fund,” the province eventually clarified. Instead, it’s managed “through cash balances of the province,” and it “sits in bank accounts of the province as an asset, not a liability.”

Recently, Brunswick News asked for an update on the fund, and how much interest had accrued.

“The income generated from the New Brunswick Advantage Savings Fund is projected to be approximately $14.6 million for 2023-24,” spokesperson Morgan Bell said in an email.

“Income will be used for the partial funding of the Enhanced Energy Savings Program, which will help more homeowners and renters make their homes more energy efficient and manage their monthly energy bills.”

According to the government, the energy program focuses on homes “needing insulation and air sealing,” and is available to homeowners with an annual combined gross household income under $70,000.

“Eligible homeowners will be offered a series of upgrades, such as the addition of basement, attic and wall insulation; ventilation for air quality or humidity issues and mini-split heat pumps for efficient heating. Homes can qualify for some or all of the potential upgrades to be completed at no cost,” reads an explanatory note about the energy program.

The impetus for the creation of the savings fund was a rosy economic outlook for the 2022-2023 fiscal year, which included hundreds of millions more dollars from income, HST and corporate taxes than the government was expecting. The surplus wound up being more than $1 billion, a provincial record.

The extra cash was fuelled by a record influx of newcomers to the province, Finance Minister Ernie Steeves said at the time.

When the fund’s creation was announced, the opposition Liberals and Greens slammed the Tories’ overall lack of spending.

“Once again, it’s extremely discouraging to see a government … only doing one thing – with these extremely big surpluses,” said Green finance critic Kevin Arseneau. “We still have people living on the streets, we still have people with mental health (problems) and drug addictions.

“We have people dying in ERs. This is all stuff that is happening, and the government is reaping all the advantages of a certain population influx but is refusing to address the challenges that that comes with.”

The savings fund, said Liberal finance critic Rene Legacy, could be more appropriately described as a “$300-million smoke show.”

Steeves, however, said the government was striking the right balance between making “progress in assuring the long-term financial health of our province while also addressing immediate needs of New Brunswickers.“