RALEIGH - Governor Pat McCrory says state government needs to tighten its belt to keep its budget balanced while paying for higher costs in North Carolina's Medicaid program through the end of June.

Today McCrory directed department heads and Cabinet secretaries to halt most employee salary increases, scale back purchases, travel and speed up collection of outstanding revenues. Assistant Budget Director Art Pope noted,

"It is better to start setting aside funds to pay for that cost over run now rather than waiting for the end of the fiscal year which ends June 30, 2013."

McCrory said in a memo that Medicaid is on track to spend between $70 million and $130 million more in state funds than originally budgeted.