One of the key policy highlights of the Chrétien governments was the elimination of the deficit and the lowering of the federal debt. Beginning in 1994, the Chrétien government undertook a broad program to reverse federal finances, which included massive spending cuts to federal programs and transfer payments to the provinces and territories (the federal government contributes billions annually to the provinces/territories in support of their social programs, such as public health care). By 1997-98, the federal government recorded its first annual surplus in 28 years, and (as of 2007) has continued to post large surpluses every year. Moreover, the Chrétien government used these annual surpluses to lower the national debt. By 2002-03, the year Chrétien resigned as Prime Minister, the debt had been reduced to $526 billion (Source: Statistics Canada, Federal Finances).