Follow the bouncing budgetary balls


As the Government of Canada coordinates the release of its signature piece of election-year propaganda, the federal budget, provincial finance ministers are scrambling to contain the public relations disasters that are their own annual spending plans.

Rarely in the nation’s history have the fiscal conditions of the regional partners in Confederation contrasted so sharply with that of the national one – a circumstance that does little to inform Canadians about the true state of the union they occupy.

Yesterday, New Brunswick’s fine, young Liberal government brought down its first budget since assuming office last fall, becoming the latest in a string of provinces (Quebec, Saskatchewan, Alberta) to swallow its bitter medicine in one, quick gulp.

Oh to be in British Columbia in the springtime. That province is doing so well these days, it managed to double its forecast budget surplus of more than $400 million in fiscal 2014-15 to nearly a billion bucks ($879 million).

The same cannot be said for Alberta, which has just posted a deficit of $5 billion, despite having raised $1.5 billion in new taxes. According to a CBC report, “The reaction . . .is mixed: relieved that there was no increase in the corporate tax rate, and concern that Albertans will have less disposable income in a time when the economy is weak.”

In Quebec, the preoccupation is with runaway debt. That province’s 2015-16, $100-billion budget is freckled with nips and tucks in almost every department, but especially in the big-ticket portfolios of health care, education and social services. “We are making reforms, we are doing things differently,” the province’s Treasury Board chairman Martin Coiteux told the CBC. “It’s not that we are reducing services. We are looking at ways to live within a budget envelope which is relatively smaller than what we would like, but this is this the required step to rebuild our room to manoeuvre.”

  And, according to a report by The Canadian Press last month, “The Saskatchewan government has brought forward a budget that attempts to put the brakes on spending increases and peels back tax incentives for middle-class families, graduates and the potash industry. . .A global oil downturn is putting the squeeze on the province’s bottom line, but Finance Minister Ken Krawetz noted that there are no new personal income taxes or fee increases.”

Now, stroll down the banks of the Rideau Canal, Blackberry on full news-alert mode from the nation’s capital, and you’ll observe that the fiscal backstory appears altogether different. Canadians aren’t mired in debt. Nay, it’s quite the contrary. Our supremely responsible, circumspect and economically gifted federal government is preparing to bring down a (nearly) balanced budget with about $4.5 billion in goodies for individual voters.

Indeed, from places like New Brunswick, Alberta and Saskatchewan, where the stern warnings of penurious governments bear almost no resemblance to the rosy messaging wafting through Ottawa’s halls of privilege and power, following the bouncing ball from provincial script to federal talking point can give a guy whiplash.

Still, there’s some reason to think that many of the differences between national and provincial bean-counters are illusory. After all, only one pot of sovereign money is  spilled or filled in this country, as circumstances require. What one branch of government giveth, another taketh away just as keenly. The Bank of Montreal has already noted as much in a recent report. As BMO economist Robert Kavcic told the CBC “most of what Ottawa will be returning to one taxpayer’s pocket, the provinces will take out of the other.”

So much, then, for a vote-friendly federal budget.

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