N.B.'s financial health worsens: AG

New Brunswick's economy has worsened in the last two years and its debt levels could start impacting the government's ability to deliver services, according to the province's auditor general.

Kim MacPherson released two reports on Tuesdayabout the province's finances and some of the government's pending programs.

"If not addressed, it will eventually impact the province's ability to meet the public's demand for services and its financial commitments to creditors and employees," MacPherson said in a statement.

'There is an immediate need for the province to develop a plan to improve its financial health.' Auditor General Kim MacPherson

"There is an immediate need for the province to develop a plan to improve its financial health. I appreciate that the government has committed itself to getting the province's financial situation under control, but this needs to translate into action."

The financial watchdog rated 12 indicators of the provincial government's fiscal flexibility, vulnerability and sustainability and offered commentary on both the short-term and long-term trends.

Indicators unfavourable

The report said nine of the indicators, such as net debt-to-gross domestic product, or total expenses-to-GDP, are unfavourable in the short term, which is a two-year span.

The auditor general's report called the net debt-to-GDP trend"concerning."

There was one indicator that was neutral, another was favourable with caution and only foreign currency-to-net debt was rated as favourable.

The auditor general's office did not have enough data to assess the long-term trends in all of the same categories. The long-term trend is determined to be a 10-year period by the report.

The New Brunswick government is forecasting a $820-million deficit in this fiscal year and Finance Minister Blaine Higgs has warned the deficit could hit $1 billion unless cuts were made immediately.