Brandon Sun - PRINT EDITION
The good news: On the surface at least, Ottawa’s deficit-fighting, across-the-board budget cuts appear to be working.
The bad news: We have yet to see just how painful those cuts will be.
For much of the afternoon on Friday, the Globe and Mail’s main headline, set above a picture of Finance Minister Jim Flaherty, heralded good news for the federal Conservatives: “Ottawa’s deficit shrinks as world economies struggle.”
The Globe reported that Ottawa posted a deficit of $832 million over the first two months of the current fiscal year, down from $2 billion during the same two-month period a year earlier.
The Conservative government’s March budget, the paper said, estimated that the size of the deficit would drop from about $24.9 billion in 2011-12, to $21.1 billion in the current fiscal year, then to $10.2 billion in 2013-14 and $1.3 billion in 2014-15 before returning to surplus the following year.
In order to do this, the feds have been counting on a combination of severe spending cuts in nearly every single government department, coupled with hopeful forecasts for Canada’s continued economic growth.
Thus far, at last part of that gamble has been borne out — personal income tax revenues are up 2.6 per cent, corporate income tax revenues have risen by 9.3 per cent and GST revenues have grown by 9.3 per cent.
While this rosy bit of economic news may look good on paper — and to the myriad of Western countries currently experiencing economic woes we look downright prosperous — there are storm clouds on the horizon.
Earlier this month, the Conference Board of Canada reported in its World Outlook Summer 2012 that the global economy will manage just 2.6 per cent growth in 2012 and perhaps three per cent in 2013. That will have a negative effect on Canada’s economy.
The board suggested that Canada will be held back by the slow U.S. recovery and declining demand in this country, as the Financial Post reported. Growth is pegged at 2.2 per cent in 2012 and 2.4 per cent next year.
There have also been real economic, social and environmental costs to the federal government’s attempt to reign in spending.
Case in point, Manitoba Premier Greg Selinger attempted to convince the federal environment minister on Friday to reverse a decision to shut down a world-renowned freshwater research facility called the Experimental Lakes Area in Northern Ontario, during a meeting of premiers in Halifax.
“We see it as incredibly valuable because of the contribution that the research has made to acid rain in the Great Lakes — no small issue — and, of course, to phosphorus and nitrification of lakes, including Lake Winnipeg,” the premier said in a telephone interview with the Globe.
Government critics — mostly scientists — have accused the government of deliberately closing the station because researchers are looking at the effects of climate change on fresh water. They suggest the findings of the ongoing research could run contradictory to the federal government’s plans to expand development in Alberta’s oil sands.
Also on Friday, Canada’s premiers released a report by a working group of provincial and territorial finance ministers that said the new federal health accord will gut nearly $36 billion in funding to the provinces over the life of the 10-year deal and will erode public health services to Canadians, as Postmedia reports.
At the same time, we remain concerned about ongoing cuts to Parks Canada’s budget and staffing levels. In 2014, Parks Canada will receive $29 million less from federal coffers than 2013. The Globe reports that some parks will be open for shorter seasons and more than 600 staff will lose their jobs. Many of those who have received notices are scientists.
While we support, to a point, the government’s stated budgetary goals, we wish there would have been fewer fiscal casualties.
Republished from the Brandon Sun print edition July 30, 2012
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The good news: On the surface at least, Ottawa’s deficit-fighting, across-the-board budget cuts appear to be working.
The bad news: We have yet to see just how painful those cuts will be.
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The good news: On the surface at least, Ottawa’s deficit-fighting, across-the-board budget cuts appear to be working.
The bad news: We have yet to see just how painful those cuts will be.
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