Hot! Jim Flaherty, the reluctant surgeon – news/opinions/editorials
Published Friday, January 21, 2011.   Editorial

In its approaching budget, the federal government must give Canadians confidence that the deficit will actually be cut, as was promised a year ago. And that means it will have to embrace a practice most governments are loath to try – detailing, not at some later date but on budget day itself, the specific actions that will be taken.

Jim Flaherty, the Finance Minister, announced $17.6-billion in savings over five years in the last budget, but the task of actually finding savings fell mainly to the Treasury Board and individual departments. Most of the difficult work was delayed till future years: “For 2011-12 and 2012-13, operating budgets of departments, as appropriated by Parliament, will be frozen at 2010-11 levels.”

That would mean an effective, substantial cut across government: a freeze is no longer a freeze once inflation, already announced cuts in some programs, and existing collective agreements that have raised pay, on average, by 5.3 per cent over three years are all factored in.

But a new report by Kevin Page, the Parliamentary Budget Officer, shows that the government is not yet ready to make those cuts. Despite a commitment by Stockwell Day, the President of the Treasury Board, that 11,000 federal jobs would be eliminated, mostly by attrition, current plans obtained by Mr. Page showed an expected reduction of only 1,133 jobs. Only one department had a plan to maintain its service quality. That gives little confidence, and with only around two months until a budget is tabled, time is running out.

Budgets typically provide the outlines of government policy; the implementation and detail come later in the year.

Yet the federal government already outlined its broad deficit-reduction strategy; that was a year ago. What is there to suggest that a similar promise in this budget will be observed?

It has been clear for a while that, despite its rhetoric, a large share of the government’s deficit reduction is based on a gamble: that economic growth will replenish our coffers. But if growth is slower than hoped, that means lingering deficits, higher interest-on-debt payments – and more pain later on.

The coming budget, therefore, cannot merely promise, again, that the cuts are coming. It must say what the cuts are.

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PBO update on government’s operating freeze

Released Jan. 21, 2011

Download this file (.pdf)

1 Comment

  1. This looks like such a beautiful venue! I love all of the gerasss and the little beach area. And those nautical table numbers so cool! Great job Krista I always adore your reception dancing shots, too, they are always so good!

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