Higher-than-expected crop insurance expenses are once again denting the Saskatchewan’s government’s finances.
In its mid-year financial report Thursday, the government projected a 2024-25 budget deficit of $743.5 million, an increase of $470.4 million from the province’s spring budget projection. A large portion of the expected overrun is due to higher crop insurance costs, a hefty $385 million or 25.1% above the budgeted amount.
Although weather conditions were good early in the season, very dry conditions in many regions of the province during the summer significantly impacted crop yields and quality, particularly with canola. Higher crop insurance claims were the result.
"Crop insurance was designed to help protect the agriculture sector from circumstances beyond their control, and that was certainly the case with the dry conditions we experienced this past summer,” Deputy Premier and Finance Minister Jim Reiter said.
Due in part to wildfire response efforts, the government’s protection of persons and property expenses were higher than expected as well, by $128 million.
Saskatchewan was hit particularly hard by drought-related expenses in 2021, when crop insurance claims were estimated in the mid-year update at $2.4 billion. Support for livestock producers that same year was estimated at more than $292 million, further pressuring the province’s finances.
