Overview
Prince Edward Island Finance Minister Jill Burridge has tabled the province’s 2026-2027 budget. The budget projects a $410 million deficit, more than double the $183.9 million deficit projected in the province’s 2025–26 budget.
In her address, Minister Burridge emphasized the need to prioritize what matters most and recognize that not every priority can sustainably be advanced simultaneously.
The budget focuses on helping Islanders manage the cost of living, with $321.7 million in affordability measures. The budget includes targeted investments in healthcare and education, with $1.4 billion in healthcare expenditures, an increase of 14.2 percent from last year’s budget.
To support this funding, while working to reduce the deficit, the province is committing to identifying opportunities to reduce costs, enhancing controls and improving service delivery. The Cabinet Committee on Fiscal Responsibility and Red Tape Reduction will conduct a comprehensive public expenditure review and examine opportunities to reduce red tape across the government. The budget also discontinued the P.E.I. Energy Rebate Program, which provided a monthly break on costs of residential electricity use. Minister Burridge said the funding will be redirected into the new P.E.I. Essentials Benefit.
Key Figures
- Projected Deficit: $410 million
- Revenues: $3.4 billion
- Expenses: $$3.8 billion
- Projected real GDP growth: 2.0%
Sector Highlights
Affordability for Islanders
- $26 million for new Island Essentials Benefit, increasing support for low- and middle- income Islanders.
- $4.5 million to enhance the PEI Child Benefit to help families keep up with the cost of living.
- $81.6 million to maintain $10 a day childcare.
- $3.2 million in personal income tac reductions.
Our Communities, Land & Economy
- $54.6 million to support municipalities and communities with necessary infrastructure and services.
- $7.5 million to continue the Rural Growth Initiative.
- $3 million to continue subsidized bus passes and transit discounts.
- $2.1 million to support community groups implementing watershed management and planning projects.
- $900,000 to support the implementation of the Interim Coastal Policy Recommendations.
- $7 million to continue support to the agricultural industry.
- $6 million to support the oyster industry.
- $61.4 million to support trade and market development, to support Island businesses.
Our Healthcare and Education
- $5 million for new long-term care beds.
- $15 million to continue providing at-home healthcare support to seniors.
- $76 million to support access to drugs, on the P.E.I. drug formula.
- $57.8 million to advance patient medical home model.
- $30.9 million to support recruitment and retention in healthcare.
- $705,000 to enhance fertility supports.
- $25.8 million to support operations at UPEI Faculty of Medicine and Health Sciences Centre.
- $4 million to support the Prince County Hospital Foundation’s Learning and Innovation Centre.
- $1.4 million to add human resources and policy capacity to the school system.
- $4.2 million to support 400 new early centre spaces.
- $410,000 to implement the Cyberviolence Prevention Strategy.
- $12 million in bursaries to support Island students at post-secondary institutions.
Analysis
The 2026-27 P.E.I. budget reflects the government’s attempt to balance historic deficits with growing affordability concerns amidst global economic uncertainty. While making investments into healthcare, education and affordability, the government is simultaneously looking for opportunities to reduce spending. Premier Rob Lantz has given the Cabinet Committee on Fiscal Responsibility and Red Tape Reduction 12 months to conduct a comprehensive review on government spending and address the provinces’ rising deficit and debt.
