PART IV: THE OUTLOOK FOR THE PUBLIC FINANCES
9. TOTAL EXPENDITURE FROM 1973-74 TO 1976-77:
1973-74
DOLLARS 4,644 MILLION
# DOLLARS 5,973 MILLION (PLUS 29%)
*
DOLLARS 6,032 MILLION (PLUS 1%)
1974-75
1975-76
1976-77 (REVISED
ESTIMATES):
DOLLARS 6,843 MILLION (PLUS 13.4%)
TOTAL EXPENDITURE INCREASED SHARPLY IN 1974-75, INVOLVING THE LARGEST
OVERALL DEFICIT IN POST-WAR YEARS. THE INCREASES IN 1975-76 OF 1% REFLECTED THE SLOWING DOWN OF THE GROWTH RATE OF THE ECONOMY. THE 1976-77 BUDGET PROVIDED FOR A 16% GROWTH IN EXPENDITURE OVER THE REVISED ESTIMATES FOR 1975-76. IN THE EVENT, THE REVISED ESTIMATES FOR 1976-77 SHOW AN INCREASE OF 13.4% OVER ACTUAL EXPENDITURE IN 1975-76, AND THE ACTUAL INCREASE IS LIKELY TO BE
LESS.
10. A FORECAST OF REVENUE AND EXPENDITURE OVER THE YEARS 1977-78 TO
1980-81 WAS PREPARED IN THE AUTUMN OF 1976. THE FORECASTS OF REVENUE WERE BASED ON EXISTING TAX RATES AND CHARGES AND ASSUMED GROWTH RATES, AND WERE EXPRESSED IN TERMS OF 1976 VALUES. THE FORECASTS OF EXPENDITURE TOOK INTO ACCOUNT UNAVOIDABLE COMMITMENTS IN RESPECT EXPANDING THEM TO MEET OF MAINTAINING PRESENT SERVICES (INCLUDING
DEMAND AT EXISTING STANDARDS AND EXTENDING THEM WITHIN APPROVED POLICIES WHERE TIMING HAD BEEN AGREED) AND NEW SERVICES.
11. THE FORECAST SHOWED AN OVERALL DEFICIT OF DOLLARS 380 MILLION IN 1977-78, DOLLARS 650 MILLION IN 1978-79 AND DOLLARS 200 MILLION IN 1979-80, WITH A SURPLUS OF DOLLARS 280 MILLION IN 1980-81. THUS, IN THE ABSENCE OF SERICUS ECONOMIC SETBACKS, THERE SHOULD BE ROOM FOR FEEDING INTO THE DRAFT ESTIMATES OF THE LAST YEAR OR TWO OF THE FORECAST PERIOD SOME ESSENTIALLY NEW SERVICES AND WORKS NOT YET DEFINED OR APPROVED.
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