We will pay for decisions by Liberals for long time

The BC Liberal government prides itself on a record of brilliant financial administration, citing a string of “balanced” budgets and the fact that BC has a triple-A credit rating.

Underneath the facile boasts, the essence of the matter is entirely different. Let’s review a string of decisions which will generate significant costs or reduce savings in future years.

In its early days, the Christy Clark government terminated the agreement with the federal government to implement a harmonized sales tax (replacing the provincial sales tax and the GST).

It’s true a referendum held in 2011 voted narrowly to reject the harmonized tax regime, but rather than giving people time to get accustomed to the new — and far superior — regime, the Clark government rushed to reject an opportunity to make the entire sales tax system both more efficient and consistent.

The next error, during the 2013 election campaign, was committing to freeze the carbon tax for five years when it should have been steadily increasing.

Here the objective was two-fold. First, the Liberals could claim to offer tax relief — even though the carbon tax was supposed to be revenue neutral. Second, the carbon tax could still yield an increase in revenue because the off-setting tax decreases in subsequent years were no longer new, but already-existing tax reductions.

In effect, revenues increased without a visible tax increase.

More importantly, by freezing the carbon tax, the Liberal government has made it virtually impossible to reach our targets for reduction in greenhouse gases.

Another fiscal sleight of hand was including BC Hydro profits as revenues in the annual provincial budget. The problem was that BC Hydro had no profits and borrowed the money it transferred to the provincial treasury.

So, in effect, the government borrowed to make the budget look balanced. This, of course, raised the debt of Hydro; it will eventually have to be paid off and portends more rate increases — though this is never admitted by the government or BC Hydro.

A monumental financial error was pushing ahead with the Site C dam on the Peace River.

There are legitimate land claims by aboriginals that should have been settled first. Failure to do so will, in the end, result in substantial damages that will have to be paid for by the citizens of B.C.

Further, the government refused to allow the BC Utilities Commission to review the budget for the project. Experts believe the estimated cost of $9.5 billion is short by at least $2 billon.

Can you guess who will be responsible for the overrun?

Finally, there is no existing market for the electricity that will be produced. It will likely be sold in the United States at below cost.

Isn’t it heartwarming to know that we will be subsidizing U.S. producers while their government is trying to reduce our other exports?

The Liberal government has consistently undercut essential expansion of the public transit system in the Lower Mainland.

Two examples: First, rather than pass legislation to fund expansion by increasing the sales tax in the Greater Vancouver Regional district, the Clark government insisted on a referendum on a very tight schedule, knowing it would be defeated.

Then it announced a 10-lane multi-billion dollar bridge over the Fraser River to replace the Massey tunnel. We don’t know for sure how this will affect public transit plans for the GVRD, but it will surely render traffic congestion in Vancouver even worse than it is now.

There are many additional bad financial decisions that could be listed. Then there is the little matter of the Liberal party fundraising. It smacks of corruption and a determined insensitivity to reasonable ethical standards.

With such a record of financial errors, taxpayers need to ask themselves if it makes sense to allow the Liberals to continue to run up our tab.

The bills will come due — perhaps sooner than we think.

David Bond is an author and retired bank economist.