Quebec needs to create more wealth, Girard says
QUEBEC They are sleek, assembled in Quebec and designed to go the distance.
On the eve of the presentation of his first budget, Finance Minister Eric Girard respected the age-old tradition of buying new shoes to symbolically mark a fresh start of a new administration.
These are not the black serious shoes of some accountants. A runner himself, Girard opted for a pair of custom-fitted splashy blue Math Sport running shoes. Total cost, $218 with tax. The minister paid for them out of his own pocket.
“Quebec needs to run faster,” Girard told reporters on Wednesday as he laced up his purchase in a Quebec City shop. “We have some catching up to do.”
And that about sums up the theme of this year’s annual financial exercise. Some time after 4 p.m. Thursday, Girard will rise in the legislature to table a first Coalition Avenir Québec government budget since the party took power in October 2018.
To say expectations are high is an understatement. The CAQ promised the world in the election campaign — from the return to a flat $8.05 a day daycare system to new air-conditioned seniors’ residences with flat screen TVs — and now is supposed to start delivering.
It also promised to reduce the fiscal burden of Quebecers by $1.7 billion over the next five years, a process it started in the December economic update.
Expect some of those more expensive ideas to be put aside or delayed for now.
Girard said the budget — to be titled “Your priorities, Your budget” — will revolve around two main general themes: improvements in services and wealth creation.
Better services means Girard — sitting on a surplus of between $1.6 billion and $4.6 billion depending on who’s counting — will open up the tap and spend more in the health and education sectors and on making life better for seniors.
The issue of wealth creation is a hobby horse of Premier François Legault. For years in opposition, Legault hammered away about the need to narrow the wealth gap between Quebec citizens and the citizens of Ontario and the rest of Canada.
And he said he dreams of the day when Quebec no longer need to be on the receiving end of Canadian equalization payments.
For the record, Quebec is set to receive $13 billion in those payments this year. The issue has become a lightening rod for western resentment as the energy based economies of those provinces tank. Alberta is getting no such payment this year.
Productivity is at the root of the problem, and Quebec knows that is not something you can fix overnight. On Wednesday, Girard said his budget will include structural changes to Quebec’s economy to get started.
“The gap with Ontario and Canada is between 18 and 20 per cent, so it will take more than one year to correct this,” Girard said. “It is definitely a long-term challenge.”
Overall, the budget will probably be a compromise between election promises, the demands of Quebec’s many lobby groups and the reality that the CAQ regime knows the surplus money in the bank will not last forever as the economy slows down.
His budget follows that of federal Finance Minister Bill Morneau.
Earlier in the day, Girard described the federal budget as a “step in the right direction,” adding Quebec would have liked more specific details on Ottawa’s intentions.
Girard welcomed Ottawa’s $3.9 billion in compensation to Canadian agricultural producers affected by new international trade agreements (40 per cent of that money goes to Quebec) and its plan to extend more high-speed internet service to rural areas.
The addition of federal infrastructure money drawn from the federal gas tax fund for municipalities is welcome — Quebec gets a $500-million boost for 2019 — but Girard said he regrets Ottawa wasn’t more specific.
He said he would have liked to see a clearer indication of the amount Ottawa is willing to pour into the extension of the Montreal métro’s Blue Line and Quebec City’s $3-billion tramway project. Legault mentioned those two items on his budget wish list this week.
‘It’s a step in the right direction, but we would have liked to get more,” Girard said. “Everything is not perfect. There are elements we would have liked to see.”
On his list of absent items, Girard said Ottawa has not come up with the compensation money for the costs Quebec incurred managing the influx of asylum-seekers in 2018. The province is seeking $300 million. pauthier@postmedia.com twitter.com/philipauthier