Hot! Parliamentary budget officer Kevin Page questions need for deep cuts

TheStar.com – opinion/editorials – Ottawa’s budget
December 02, 2012.

Some $5.2 billion in departmental spending cuts, 19,000 public service jobs slashed, a major diminution in environmental protections, the whittling away of our public broadcaster, government pensions and social services — these were just some of the measures contained in the nearly 500-page 2012 federal budget, the most austere since the mid-1990s.

The cuts were deep but necessary, we were told, if we were going to weather the aftershocks of the global recession without raising taxes.

But a new report from indefatigable parliamentary budget officer Kevin Page suggests that Canada’s economic reality may not be quite as bleak as the Conservative government would have us believe. In an analysis of the government’s latest economic update, Page argues that … to the government of the weak economy by $4.7 billion per year over five years. In fact, Page concludes, the government should be running a surplus by spring 2015, a year ahead of projections and, conveniently, just in time for a pre-election good-news budget.

Though Finance Minister Jim Flaherty’s office dismissed Page’s report, the government’s projections have other economists scratching their heads, too. TD Bank chief economist Craig Alexander told The Canadian Press that he was “surprised by how much weaker the government was projecting revenues.” Indeed, Finance appears to have reduced its revenue expectations by roughly three times the level recommended by a panel of private-sector economists in the lead-up to the latest update — a decision that Page has rightly asked the government to explain.

There’s nothing new about hyperbolically cautious federal financial projections. As finance minister, Paul Martin consistently and significantly underestimated his often-huge surpluses during the late ’90s and early 2000s. A little prudence is good policy and under-promising and over-delivering is even better politics.

But in the case of this government, which is now using these projections not only to contain spending but also to justify deep cuts with deep consequences, the stakes are higher. Page wants to know how the government arrived at its numbers so the two vastly different projections can be reconciled. If the government continues to insist that given the numbers austerity is the only way, it owes Canadians a full accounting.

< http://www.thestar.com/opinion/editorials/article/1296202–parliamentary-budget-officer-kevin-page-questions-need-for-deep-cuts >

1 Comment

  1. Ethics, good governance, prpeor financial management and economic planning are all things that the Cayman Islands have not seen over the past two political terms. Politicians have become more concerned with being re-elected than the performance or the country. They have forgotten that a country must be run like a business and in business the aim is to see a profit.We have taken on projects and they were not prpeorly budgeted for; therefore have been out on hold, but yet we still invest in larger projects in hopes that there will be a turn around.Our government is laced with immaturity and this needs to stop, as a public figure you will be exposed to scrutiny it comes with the position; the people are not required to agree with your decisions; that is a right they have.The lack of transparency is also an issue that we face, although the Freedom of Information Office is doing a good job the government still passes plans and begins projects without prpeor public discussion. Items that are to be brought before the Legislative Assembly are now being done on an ad-hoc basis with the majority party having their proposals passed with ease.As I have stated before it is time for term limits I hope that this white paper brings about the changes needed for Cayman to begin to step in the right direction.

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