N.S. accepts Harper equalization plan in balanced budget

Nova Scotia's Conservative government has tabled its sixth consecutive balanced budget and has opted to accept the federal government's extra $79 million in equalization payments in a revamped formula.

This means the province will no longer have control of offshore oil profits, but it said it chose the short-term federal funding to avoid tax increases and program cuts.

The federal government will allow the province a year to lock in its choice, although Finance Minister Michael Bakerapparently doesn't believe changing formulas again will be beneficial.

"I don't anticipate there would be any new data available to us in a year from now that's not presently available to us," he said Friday.

NDP Leader Darrell Dexter supports Baker's choice.

"That's a no-brainer. I mean, you're [going to] take this year, and you're going to take the opportunity to take the increased money and still have the flexibility, I understand, to opt out some time in the future," Dexter said.

The $7.9-billion fiscal plan includes modest spending increases, but still hits taxpayers in the pockets by raising user fees andtaxes on cigarettes. It will also ask the Nova Scotia Liquor Corporation to raise the price of alcohol.

The extra cash is needed to fuel an increase in spending of almost $400 million, a six per cent increase in overall spending.

There is some good news for taxpayers. Premier Rodney MacDonald is going ahead with tax cuts he set in motion last year.

Students will have access to a larger tax credit if they stay and work in the province. Last year, they could claim a $1,000 credit. That's been increased to $2,000.

People who are still in university, or are just starting, will also have access to needs-based grants. That's something student groups have been lobbying for for years so poorer families would have a chance to send their kids to university.

Volunteer firefighters are also getting a long-awaited and much-promised tax break. They'll be able to deduct $250 this year and up to $500 by 2009. The original promise was the full $500 tax break this year.

Families must wait for drug coverage

Another big ticket-promise that's being phased in is the Working Families Pharmacare plan. The premier promised the plan would start this year. But it will take up to a year to set it up, so families without private insurance will have to wait for provincial drug coverage.

There will be the same year-long delay for a provincewide colorectal screening program.

When it comes to social assistance, two promised measures are being delayed: an end to the Canada Pension Plan clawback and a promised rebate to seniors to help them pay their property taxes.