BIG WORDS, NO FIGURES

Horgan aims to crack Clark’s shell game, but won’t spill the beans on MSP plans

With the year’s end approaching, Opposition leader John Horgan seized the opportunity Wednesday to take a final shot at the B.C. Liberals for an almost $50-million cash grab on Medical Service Plan premiums.

“Christy Clark’s MSP shell game will deliver an unhappy New Year’s surprise to British Columbians,” the press release from the New Democratic Party caucus declared.

“Medical premiums are an unfair tax on an already struggling middle class,” Horgan said. “Now Christy Clark is sneaking in another 10 per cent increase on half a million families while claiming she is doing the opposite.”

Exactly so. The B.C. Liberals are lately trumpeting the elimination of a scheduled four per cent increase for all MSP premium payers that was to have kicked in on Jan. 1.

The increase was announced in the February budget, part of an annual ritual under the B.C. Liberals that has seen four per cent increases year after year. But Finance Minister Mike de Jong cancelled the increase as part of the September budget update. His reason was the fiscal leeway provided by a projected $2-billion operating surplus, up from $300 million in February’s projection, but he was surely trying to catch up with Premier Clark’s widely reported characterization of the premiums as regressive, unfair, antiquated and a burden on families.

In any event, the B.C. Liberals are treating the cancellation as an accomplishment worthy of praise, recalling the classic dodge where the government first puts a stone in your shoe, then takes credit for removing it.

But in an opposition version of the rain-on-their-parade manoeuvre, Horgan drew attention to one premium increase that was still on the schedule. Effective Jan. 1, the government is obliging couples on premiums to both pay the full amount, ending a discount of about 10 per cent on the combined rate — one of several changes in the premium structure that would bring in an additional $46 million in a full year, according to the fine print of the February budget.

But more to the point for British Columbians was this passage: “This change will result in a $14-a-month increase in premiums for about 530,000 couples.”

In a world of $5 coffees and $200 running shoes, $14 might not seem all that much. But Horgan underscored his point by inviting reporters to meet with a couple for whom the 10 per cent increase represents a significant additional bite from the family budget.

She’s a secretary at the legion. He’s a military veteran. Together they are already paying $1,632 a year in premiums. As of Jan. 1, they will be paying an additional $168, or $1,800.

The annual outlay for premiums underscores the larger point Horgan sought to make Wednesday — namely the unfair distortions associated with the MSP premiums under the B.C. Liberals.

For many working people, me included, the premiums are paid by their employer, albeit as a taxable benefit. Low-income earners are exempt altogether. And as of this year, the Liberals are no longer requiring parents to pay premiums for their children.

But many others pay full freight, with no allowance for their financial circumstances. The premiums are like a flat tax — everyone pays the same, regardless of income level. And for folks on a fixed income like the couple at Horgan’s press conference, the financial bite is huge. I would have to think that $1,800 is real money to a lot of British Columbians.

“Christy Clark thinks senior couples living on fixed incomes, and young people who are just starting their professional lives, don’t deserve a break,” Horgan said, citing two groups for whom the loss of the 10 per cent discount is likely to be particularly onerous. “I think all British Columbians should be treated fairly,” the NDP leader continued. “It’s time we eliminated MSP for good. No more of Christy Clark’s tinkering around the edges.”

There, by way of a press release, was a preview of a plank in the coming NDP election platform dealing with the financial burden that premiums impose on British Columbians who pay them.

“Our solution is simple,” Horgan told reporters. “Get rid of it.”

He’s been saying that for a while. But as with those previous occasions, he’s not yet saying how a John Horgan-led NDP government would cope with the elimination of what amounts to a $2.5-billion annual source of revenues for the provincial treasury.

One option, discussed by Green party Leader Andrew Weaver, would replace the premiums with a line-item collection in the provincial income tax. Another would substitute a payroll tax, paid by the employer. And there are other combinations.

For folks on a fixed income like the couple at Horgan’s press conference, the financial bite is huge.

But depending on the options, the tax shift could be dramatic. Premiums currently bring in almost a third as much as provincial income taxes. The mainly unionized workers whose employers cover their premiums would not welcome the prospect of a sudden hike in income taxes.

The NDP is studying a number of options for keeping the promise to get rid of premiums, Horgan said Wednesday. But that was pretty much all he let on.

“We’re going to tell you about it when we tell you about it,” was Horgan’s off-putting reply when I asked when he’ll be taking the wraps off the plan to phase out the premiums. But presumably the details will be laid out in the NDP election platform, due for release between mid-March and mid-April.

After years of contention over premiums, a dollar-by-dollar plan for eliminating them is long overdue. vpalmer@postmedia.com twitter.com/VaughnPalmer