Monday, 7 March 2016


It is difficult not to feel a sense of anticipation building around the forthcoming Budget. Not just business but the public, too, are speaking fearfully about the measures that Finance Minister Cathy Bennett may impose to return the Province to a state of fiscal sanity.

Of course, the words “may impose” have no legitimate place in the current budgetary discourse; but they are there. One might ask: what does the Minister and the Premier not understand about a $2 billion deficit, and a reluctant bond market demanding proof the government will act? 

The mere fact that the Minister failed to follow through with the proposed HST hike, in spite of deteriorating revenues, and having failed to offer immediate off-setting tax hikes and spending cuts, represents a sure signal the new government was not quite ready to govern. Indeed, Ball’s early comments suggested he might find respite in Ottawa. Likely, by now, he has figured out partisanship doesn’t count for much; besides, we should fix the problems we have created.  

One thing is certain. The fiscal crisis has not improved since the Liberals took power.

Many believe the public engagement process is less an act of consultation than of delay. Some say the ideas it has generated do not reflect the dire state of the government’s fiscal circumstance. It has received no help from public sector unions; even the doctors offer only a placebo.

What is left to advise the Premier and the Minister? Shouldn’t we just wait for whatever the Minister decides?

I suggest one simple virtue ought to influence the government’s decisions in advance of, and during, the Budget presentation. That is integrity.

Honesty and straightforwardness have been missing from public policy decisions for far too long. The Tories used subterfuge, intimidation, partisanship, as well as raw power to advance their goals.  Demagoguery worked for a while, too. But truth, because it contains its own fuel, is better currency and will last longer. When fortune’s cycle has been run, pixie dust dissolves, but not the deceit it breeds.

Honesty is a default to logic; it is evidence based and constitutes the gravity around which meaningful and enduring public policy issues revolve. The public needs to know the truth. They need to know that their government respects the virtue no less than they do.

The trail of revenue loss in the budgetary materials is something anyone can figure out. The Wiseman Plan (concocted by Paul Davis’ Minister of Finance last year) forecast five more years of deficit, on top of the four deficits in a row already experienced; then he stated there would be balanced budgets. The brazen Tory Finance Minister forecast prices $71-$90/barrel oil over the next five years and omitted any reference to the capital needed for Muskrat Falls.

Using the items which received excessive funding (in total, 145% of the average of those of the other provinces), the new Budget needs to describe a road map for a path to a more sustainable base.

Indeed, the current fiscal issues can only be dealt with if it is a complete narrative, one that pulls no punches. Nothing less should be laid before the public. It will have credibility only in consequence of its completeness and its factual basis.

If the province’s financial position is described selectively or is “spun” for a political purpose, tough medicine will be derived of credibility and get rejected.

If Nalcor CEO Ed Martin’s fingerprints are all over Muskrat EY Review, already undercut by both the choice of Reviewer and its Terms of Reference, the public will be unsympathetic especially as the reality of an impending doubling of power rates hits home.

In addition, not just Muskrat, but the state of Nalcor’s investments need to be laid bare, especially the degree to which the fall in oil prices have altered their original thesis.

Other programs, including expenditures on the proposed Gull Island hydro project, must be disclosed.

It is unthinkable that we will suffer program cuts and tax increases as funds are applied to an “energy warehouse” mandate that was always unwise, and now plainly dumb.

If lives and livelihoods are impacted as public funds are wasted for a foolish purpose, not only will the Liberals be robbed of the moral authority needed to conduct painful program alignments, there will be hell to pay!

So far, the Liberals have been very generous to the Tories; though they have no reason to be.

The blame game is inherently distasteful. But that is not the same as saying it serves no purpose or that it degrades politics. On the contrary, any bolstering of bad policy, especially any outcome re-framed as a loss of good fortune, is not just bad politics; it reinforces the lie that all politicians are corrupt; that there is no need for standards of honesty and decency.

This Budget should tell all; it should pull no punches.

The integrity manifested in the Budget will constitute the government’s first opportunity to demonstrate it was and is serious about “change”.

Sheer honesty and straightforwardness should be its hallmark.

If that is the case, and the government is decisive too, the medicine may be bitter, but it holds the best chance it will be swallowed by the public.