Prov­ince faces dif­fi­cult changes in spring bud­get

The Guardian (Charlottetown) - - EDITORIAL -

Pre-bud­get con­sul­ta­tions are noth­ing new for Prince Ed­ward Is­land min­is­ters of fi­nance. They are held each year as govern­ment lis­tens to Is­lan­ders on spend­ing pri­or­i­ties and hears sug­ges­tions on where to spend and where to cut.

It seems un­sure if the fed­eral govern­ment is go­ing to hear from Cana­di­ans be­fore bring­ing down its bud­get but in that case, Ottawa has sig­naled it will go heav­ily into debt as it em­barks on a spend­ing spree to boost the econ­omy. The Lib­er­als are in­tent on ful­fill­ing ex­pen­sive pre-elec­tion prom­ises with huge amounts of in­fra­struc­ture spend­ing.

Fi­nan­cial plans seem some­what de­fined on the fed­eral side even with­out in­put from Joe Pub­lic. The provinces are be­ing con­sulted on in­fra­struc­ture, pen­sion plans, health and other key is­sues through fed­eral-pro­vin­cial con­sul­ta­tions.

But such is not the case on the Is­land where the pro­vin­cial govern­ment is in­tent on pre­sent­ing a bal­anced bud­get for the 2016-2017 fis­cal year.

The prov­ince is hop­ing Ottawa will spend ex­tra bil­lions, al­low­ing the prov­ince to ben­e­fit sig­nif­i­cantly on so­cial and in­dus­trial in­fra­struc­ture. At the same time, the prov­ince has hinted it plans to freeze or cut wher­ever pos­si­ble, and has es­sen­tially usurped pre-bud­get con­sul­ta­tions. Years of bal­anced bud­get pro­jec­tions and prom­ises have failed and Fi­nance Min­is­ter Allen Roach seems de­ter­mined to end that string of fail­ures this spring.

He faces a daunting task. The last fis­cal up­date pre­sented in late 2015 showed the deficit had leaped to $32.9 mil­lion to the end of Septem­ber — from a pro­jected $19 mil­lion — be­cause of ex­tra spend­ing on education, health and pen­sion fund­ing.

Govern­ment fore­casts still sug­gest that the prov­ince will achieve a sur­plus of $11.9 mil­lion in the up­com­ing bud­get.

Premier Wade MacLauch­lan might have shed ad­di­tional light on his plans dur­ing a state of the prov­ince ad­dress Mon­day night in Char­lot­te­town.

In a year-end CTV tele­vi­sion in­ter­view, the premier hinted at across the board cuts — as high as four to five per cent.

If true, and they ex­tend to education and health — the de­part­ments with by far the largest bud­get al­lot­ments — then Is­lan­ders will be hit hard to achieve fis­cal bal­ance.

Govern­ment is seek­ing af­fir­ma­tion more so than ideas in the up­com­ing bud­get con­sul­ta­tion process. Many in­di­vid­u­als and groups mak­ing on­line or in per­son sub­mis­sions will sug­gest that bal­anced bud­gets are a de­sired goal but how many are go­ing to sug­gest cuts or where? It would al­most be an ex­er­cise in self-in­crim­i­na­tion.

With govern­ment’s stated in­tent for bal­ance and hints of cuts, it will be brave in­deed for in­di­vid­u­als or groups to ap­pear and de­mand spend­ing in­creases — in di­rect op­po­si­tion to the prov­ince’s goals.

Min­is­ter Roach is still hop­ing for ideas and sug­ges­tions on trim­ming, ef­fi­cien­cies and bet­ter ways of do­ing things. Govern­ment won’t be very in­ter­ested in lis­ten­ing to de­mands for spend­ing in­creases even though the needs are great in many de­part­ments.

“We need in­put on what pro­grams and ser­vices are most im­por­tant to them, where sav­ings can be found, and how we can in­crease rev­enue and grow our econ­omy,” in­tones Min­is­ter Roach.

Un­less Is­lan­ders make a strong and con­vinc­ing case to keep what they have, cuts are loom­ing.

Govern­ment wants to hear how we can reach a bal­anced bud­get.

Mr. Roach wants sug­ges­tions on cuts, not spend­ing. If govern­ment is se­ri­ous on hold­ing the line on front-line pro­grams, at best it could mean a freeze or the most min­i­mal in­creases in health and education.

Govern­ment isn’t of­fer­ing Is­lan­ders much ad­vance help. Op­po­si­tion fi­nan­cial critic Dar­lene Comp­ton makes a good point by con­trast­ing what is hap­pen­ing in New Brunswick. She says the N.B. govern­ment has launched a pub­lic en­gage­ment process, lay­ing out a va­ri­ety of spend­ing and tax pro­pos­als in ad­vance of seek­ing pub­lic feed­back. That re­sulted in more than 1,300 cit­i­zens’ and stake­holder groups par­tic­i­pat­ing in some 20 ses­sions on spe­cific spend­ing and tax pro­pos­als.

To move from $32.9 mil­lion in the red to $11.9 mil­lion in the black in one fis­cal year on P.E.I. will re­quire in­no­va­tive, her­culean ef­forts.

Dif­fi­cult de­ci­sions will have to be made.

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