07:54 AM EST, 02/19/2025 (MT Newswires) -- While Nova Scotia's Budget 2025 lifted its spending plan on the back of recent revenue windfalls, the Canadian province continues to project deficits over much of the planning horizon, noted Desjardins.

The plan includes a C$200 million contingency in each year of the planning horizon to address ongoing uncertainties related to United States trade tariffs, said the bank.

The current consolidation plan includes a rapid reduction in the deficit and eventually a balanced budget before the contingency by FY29, pointed out Desjardins. However, this rests upon somewhat optimistic economic assumptions -- the province anticipates robust revenue growth to offset minimal spending increases over the medium term.

Despite a better starting point, wider deficits and a large capital spending program are expected to drive the net debt-to-GDP ratio sharply upward, reaching over 40% by FY29.

Borrowing requirements before contingency are now projected to total C$3.0 billion in FY26, C$3.5 billion in FY27 and C$3.9 billion in FY28 -- a total of C$2.4 billion more than the last budget's projection over the three-year horizon -- and C$2.6 billion in FY29, added the bank.