N.S. auditor repeats call for more oversight of government spending outside budget

HALIFAX — For the fourth year in a row, Nova Scotia’s auditor general is recommending stronger oversight on how the provincial government spends money not included in the budget.

Kim Adair’s annual report released Tuesday highlights $1.6 billion in spending in the 2024-25 fiscal year that wasn’t first authorized by a majority vote in the legislature. Since the 2020-21 fiscal year, the government has spent more than $6.7 billion outside the budget process.

“The real issue is that the accountability process for over-budget spending in Nova Scotia does not require the legislature to review, vote on and approve the extra amounts — a process that is followed in many other provinces across Canada and at the federal government,” Adair told a news conference Tuesday.

The province’s Finance Act, which is unique to Nova Scotia, allows for extra spending to be approved solely by the government of the day.

Given that she has recommended on three other occasions that changes be made to address this issue, Adair said, “I don’t have a lot of optimism, because the response from the minister is pretty much a status quo response, the same as we’ve gotten in the last few years.”

“But I’m hopeful in time it will get some traction,” she added.

Minister of Service Efficiency Tim Halman, acting on behalf of Finance Minister John Lohr, said in a statement Tuesday that the government uses additional appropriations as a way to invest “with the level of urgency that Nova Scotians expect.”

“These investments were necessary to speed up the expansion of health-care access after years of underinvestment and cuts by previous governments,” Halman said.

NDP finance critic Lisa Lachance told reporters Tuesday the government needs to be more transparent with Nova Scotians about the financial choices they’re making. “We’re out of step with the rest of the country by not having a chance in the legislature to review all government spending,” Lachance said, adding that the government should amend the Finance Act to allow taxpayers to track government spending more easily.

“Government is not being clear with Nova Scotians about how they’re spending their money. (And) there is increasing debt,” Lachance said.

Despite an operating surplus in the 2024-25 fiscal year of $265 million, Nova Scotia’s net debt grew for a fifth consecutive year.

Net debt, defined as the government’s total debt minus its financial assets, has reached $20.8 billion — a figure Adair said weakens Nova Scotia’s financial position, as more of its future revenues will be needed to service the payments. The ballooning debt could harm the province’s ability to provide services without additional borrowing, Adair said.

The Nova Scotia government, she said, has run an operating surplus for four of the past five years — totalling $5.8 billion — but the government has used that money to increase spending as opposed to paying down its debt.

“The unanticipated revenue, revenue windfalls that have been experienced for the last three or four years have been in turn spent on this over-budget spending,” Adair said.

Halman said government is aware of the auditor general’s concerns and “as we prepare the 2026-27 budget, we will be focused on growing the economy and providing the programs and services Nova Scotians need, while also ensuring our long-term fiscal position is strong.”

The province’s annual spending for 2024-25 hit $18 billion — up by $5.4 billion or 43 per cent — since 2021-22.

Adair noted that health-care costs hit $7.7 billion, with $361 million toward the Halifax Infirmary expansion and $146 million for the health-care redevelopment project in Cape Breton.

Liberal member Iain Rankin told reporters Tuesday that health care is always going to be the Number 1 budget item — “but the outcomes aren’t actually meeting the level of spending. What we’re seeing today is that when you’re spending more and more money, it doesn’t necessarily mean better outcomes.”

Rankin said Nova Scotians are concerned about wait times at emergency departments and access to family doctors.

This report by The Canadian Press was first published Jan. 13, 2026.

Lyndsay Armstrong, The Canadian Press