By Dean Skoreyko
The new B.C. Liberal budget is another step in the wrong direction for this government, in a series of wrong steps dating back to 2001. The new budget increases record spending, puts us on a path for record debt, and continues to put paid to the myth that Gordon Campbell’s government runs a sound economy.
What this budget really does is make the appearance of funding important areas to British Columbians, like health care and education, while it’s really straining those services more than ever.
While on the one hand they increase funding to health care, they’re doing so by taking more money from British Columbians. The budget announces that in the first year of the HST, which comes into place on July 1, they will use all of the revenue for health care.
On March 2, Finance Minister Colin Hansen announced in his budget that he will introduce a new law requiring all HST revenue to be dedicated to health-care spending. But that entirely contradicts the previous assertions that the hugely unpopular HST was to be revenue neutral.
So which is it? The Liberals can’t have it both ways.
It’s not surprising that the Liberals needed to defer revenue from one stream in order to fund expenditures from another. This government has consistently underfunded health care in the past, and in the lead-up to the Olympic Games, they even made cuts to hospitals and surgeries, putting the Olympics ahead in priority.
With education, the increased funding now isn’t likely to do anything to slow down the closing of 176 schools during the time of the Campbell government, and that’s mainly because they have, at best, staunched the flow of bleeding from our education system.
The new adoption of full-day kindergarten will rise to a cost of $129 million by 2012, which might be welcome to parents lucky enough to have a child at precisely that age bracket, but it does absolutely nothing for the 12 other grades in the school system. Moreover, the increased costs of medical services premiums will strain the school administrations, forcing them to squeeze out every last dollar, and make cuts to staff and supplies.
It’s quite literally a matter of reaching to give with one hand while taking with the other. Then there’s the red ink that flows, and has now been promised will continue to flow, until the year 2014. This, from a premier who promised during the last election that the deficit was “$495 million max”, and it turned out to be $2.8 billion. This, on top of the increased stealth taxes that the Liberals will be levying on you, the taxpayers, in the form of the carbon tax, the HST, and medical services premium increases.
According to Hansen’s latest forecast, B.C. will sustain deficits of $1.7 billion, $945 million, and $145 million in the next three fiscal years, from 2010-11 to 2012-13, before returning to expected surpluses thereafter. That would bring B.C.’s public debt from $36.1 billion in 2001 to $55.9 billion by the end of the budget forecast. Moreover, that debt burden puts $14,300 per capita on B.C. residents, only $1,300 less than our per capita federal debt.
The other problem with the budget forecast is in repeating the mistakes of the federal government’s own optimistic revenue and growth forecasts. Hansen expects annual revenue growth of 4.9 percent, but there’s little indication that British Columbia will continue to recover from the recession quickly enough to make that growth, or that the HST won’t throw a wrench into those plans. Not only will all HST revenue go into health care, but the increased taxes on medical services premiums will also increase the tax burden on the base. The carbon tax is also slated to go up once again on July 1, the same day the HST will kick in.
Instead of providing economic stimulus with tax cuts, implementing proper funding to hospitals and schools, and reigning in our public debt, we’re being hit with more taxes, underfunding, and record debt not seen since the days of the last NDP government. This is, truly, a budget that only meets the needs of the premier and the B.C. Liberal Party.
Dean Skoreyko is the membership and CA development chair for the B.C. Conservative Party. He was the 2009 B.C. Conservative candidate in Vernon-Monashee.