The real Ministry of Magic exposed #nlpoli

The information the Conservatives leaked to David Cochrane Tuesday on the budget update confirmed the extent to which they are actually the ones who have been running the finance department as if it was a ministry of magic.

The cash deficit this year looks like it will wind up being almost $3.0 billion.  Bear in mind that the budget the Conservatives introduced last spring called for a 12% increase in spending  - although they talked about restraint - and for borrowing $2.1 billion to cover a record deficit.

Incidentally, the accrual deficit figures leaked to Cochrane by the Tories leave out the $900 million the Conservatives planned to borrow for public works.  You need to look at the cash numbers to understand the magnitude of what the Tories did last spring.

When is a cut not a cut? #nlpoli

A couple of years ago, the province’s auditor general noted that a Crown agency responsible for developing an integrated health information system was paying salaries to its employees that were way outside provincial government guidelines.

The Telegram reported last fall that the problem was still unresolved 18 months after the auditor general issued his report. This was no small matter. Salaries grew 354% between 2007 and 2012, according to the Telegram. In one case, the salary for a senior executive member jumped by 119%.

Last week, and in the wake of an updated report by the province’s auditor general, Canadian Press reported that health minister Steve Kent had cut salaries at NLCHI. They’d save $50, 000 in one case and altogether the salary cuts would save $330,000.

Small problem.

The Fourth Party #nlpoli

A Telegram editorial on Wednesday contained a curious comment.  

The subject was news that broke this week about the provincial government;s energy corporation.  Two senior corporate officials are refusing to testify in a court case in Quebec over contending interpretations of the 1969 power contract between Churchill Falls (Labrador) Corporation and Hydro-Quebec.

Nalcor is refusing to respond to the Quebec court’s order, insisting that the order must come from a court in this province.  Now the entire court case is extremely important because it is crucial to Nalcor’s entire scheme for Muskrat Falls.  The fact that Nalcor is thumbing its nose to a legal process that it is a party to, through its majority ownership of CFLCo is both troublesome and needlessly offensive.

But that’s not the curious point from the editorial.  Whoever wrote the commentary added this bit toward the end:

It’s possible they are simply mirroring the intransigence of their Quebec counterparts to co-operate with actions in this province — as, for example, Hydro-Québec did in refusing to participate in PUB hearings on the water management agreement.

The problem with the statement is that it simply is not true.

Austerity #nlpoli

All this talk of austerity, gutting the public service….

Then you look at the salary costs, from the provincial budget.

There’s something that just doesn’t add up.

-srbp-

The Red and the Black: budgets and politics #nlpoli

The annual budget is probably the most political document of any government in a Westminster style parliament like ours.

At its simplest and most obvious level the budget is the formal statement of a government’s priorities.  Once approved by 1the legislature, it gives government the legal authority to spend money.

The budget is, in that sense,  the most obvious display of what political scientist David Easton defined as politics:  the authoritative allocation of values.

There’s more politics to the budget than just that, however.

Conservatives stay the debt-building course #nlpoli

Budget 2015 offered absolutely no surprises.

On major areas the Conservatives continued their policy of spending more than the provincial treasury can afford.  That’s been their trade-mark since 2003 and it became etched in stone in 2009.

As SRBP forecast a couple of weeks ago, the Conservatives raised a modest amount of money through a two percent hike in the provincial sales tax and a variety of small fees.  They added some new tax brackets at the upper end of the income scale.  The small twist in that one came from the actual release of the proposal by Memorial University’s economics department.  They recommend an improved rebate scheme to transfer the additional tax revenue to lower income residents.

Other than that, the Conservatives borrowed heavily. The deficit is a record for any government since Confederation. Your humble e-scribbler knew it would be bad.  It was worse than imagined.  That’s because – contrary to the forecast – they didn’t reduce capital works spending.

Lots of people are focused on the tax increases.  They amount to slightly more than than 10% of the total deficit. In the bigger scheme of things it is nothing.  It is just laughable for anyone to call this budget “tough”. 


Let’s look at some specific points.

The sky is falling. Or not. #nlpoli

First they claimed the budget consultation would be way later than usual.

So your humble e-scribbler worked it out. 

Turns out it wasn’t later than usual.

Then they said the budget would be way later than usual.

End of April or early May? 

Turns out that while the budget usually shows up around the end of March,  the Tories brought down two back-to-back budgets in April a few years ago.

Premier Paul Davis tied the provincial budget to the federal one and last week the feds started talking about a budget in May. 

Then there’s the Doom and Gloom forecasts of every public sector union in the province.  The Conservatives are going to sell everything,  cut the rest, and fire everyone else.