Premier Brad Wall and his Saskatchewan Party government have been playing a cynical game of hide and seek about the province’s fiscal situation.

First, the government delayed the presentation of its budget by at least three months, moving it from the traditional March budget date to June 1. The government’s rationale was that the budget couldn’t be released during the provincial election campaign without violating the government’s own election advertising rules.

The provincial election itself was delayed by the Oct. 19 federal election, which pushed the provincial election from the government’s four-year anniversary date of Nov. 7, 2015, to April 4, 2016.

New Finance Minister Kevin Doherty inherited a fiscal time bomb in the 2015-16 budget, which projected a $107-million surplus: by mid-year, that projection had downshifted to a $262-million deficit.

By the third quarter, the projected deficit was $427 million. But Doherty waited until after the budget was released and almost four months after the end of the fiscal year to announce that the deficit was actually $675 million.

That’s almost a quarter of a billion dollars off the third-quarter estimate and more than three-quarters of a billion dollars off the 2015-16 budget forecast.

Of course, the usual suspects were blamed: plunging oil and potash prices.

The situation was strangely reminiscent of 30 years ago, when the Progressive Conservative (PC) government of Premier Grant Devine forecast a $379-million deficit for the 1986-87 fiscal year, got re-elected in October 1986, then dropped the bombshell in the 1986-87 budget that the deficit would be $1.2 billion.

Besides being “small C” conservative, rural-based governments, there are other similarities between the Wall and Devine governments. The Devine PCs also were battling low energy prices, thanks to overproduction by OPEC.

Then-finance minister Gary Lane warned that if nothing was done, the deficit would balloon to $1.5 billion by the next fiscal year. But Lane promised to halve the deficit in 1987-88 and then again in 1988-89, balancing the budget by the end of that government’s second term of office.

As it turned out, that deficit remained for another 10 years, long after the resounding defeat of the scandal-plagued PCs by the resurgent New Democratic Party under Roy Romanow in 1991. In fact, the deficit wasn’t eliminated until 1996-97.

That huge deficit marked the beginning of the end of the PC party, which, following its humiliating defeat, collapsed and reformed in 1997 with a handful of Liberals and rebranded itself as the Saskatchewan Party. One of the ministerial assistants in that former PC government was none other than Brad Wall, who rose within the ranks to become Saskatchewan Party leader in 2004.

The moral of the story: be careful in letting the deficit genie out of the bottle. It can prove very hard to get back in.

© 2016 Investment Executive. All rights reserved.