Due to the absurdly low prices of natural resource, Standard & Poor had decided to cut down on Saskatchewan credit rating from the former double A-plus, downgrading to Triple-A for now. Sadly for the province, they have been greatly affected financially from the low natural resources prices, especially in oil and potash, and it has taken a toll on the budget.
The government of Saskatchewan previously ran a discrepancy check during the fiscal year around the 31st of March, which predicted another deficit to happen again this year. From the look of things, the credit rating agency had a negative outlook that made them reach a conclusion on the failure of the province to meet their targeted budget including slow growth in the operating expenses, making its chances seem bleaker according to Standard and Poor.
So far, it has been noted that Saskatchewan’s reserve funds – which has been set aside – have dropped drastically to the extent that it can no longer be used to account for any shortfalls encountered by the province. Based on the report, Saskatchewan has had unstable financial results compared to other provinces with resource-based economies, including places like Newfoundland and Alberta.