Five highlights from Quebec’s ‘beige’ budget
QUEBEC CITY – “Good question, but I don’t have a response today.”
The words of Quebec Finance Minister Nicolas Marceau could accurately reflect a more general view of the budget presented by the Parti Quebecois on Thursday.
His explanation for the missing numbers is: “We don’t want to finish the work if it won’t be adopted.”
The leader of Quebec’s Liberal Party said that the lack of detail, especially with regards to expenses, is a significant issue and “a serious flaw.”
“In my family, when we have a budget, we have a column for income and another one for expenses,” Philippe Couillard said.
“Without that information, how can we know what the government is spending?”
Although considered by many political pundits to be a budget created to kick off an election, many agree that it doesn’t seem to be designed to inspire voters.
AT A GLANCE: Winners and losers of Quebec’s 2014 budget
“It’s a beige budget,” said Simon Prevost of the Quebec Manufacturers and Exporters.
“Daycare cost hikes aren’t something you take to families to get their vote.
“The message is ‘It’s time to live within our means.'”
It’s a message that the Conseil du patronat du Québec, an interest group that represents the largest employers in the province, has been repeating in past weeks.
The council’s president Yves-Thomas Dorval has been calling for a review of maternal and paternal leave programs and the daycare subsidies, which he considers particularly expensive endeavours that could slide Quebec into bankruptcy.
Five highlights from the Quebec 2014 budget:
Not yet a balanced budget
Reducing Quebec’s debt is a priority
The major theme in November 2012 of a balanced budget at whatever the cost is still considered a priority. The finance minister said on Thursday that the government is committed to balancing the provincial budget by 2016. He is projecting a deficit of $2.5 billion in 2013-2014, then $1.75 billion in 2014-1015 and arriving at a balanced budget as of 2015-2016.
“Debt reduction must continue and even be accelerated in times of economic growth, so that Quebec is in a strong position to face an eventual recession.”
The province’s debt is the highest of all the provinces in Canada, and one of the highest in the world. Marceau contends that the higher debt costs are, the less money there is to fund public services. This is particularly important because of Quebec’s demographics, where the aging population is “gradually exerting a downward pressure on economic growth and, consequently, government revenues.”
Health care re-evaluated
Quebec health care to be more like the rest of Canada
An ageing population also effects government expenses like health care.
“What we want to do is something that is feasible and that has been done in the rest of Canada,” said Marceau.
While he acknowledged that the demographic composition is slightly different in Quebec, he said that the main provinces were spending less and growth rates were comparable.
“Other provinces in Canada are spending less. For example, Ontario spends 7.4 per cent of its GDP [on health care] while Quebec spends 8.5 per cent.”
To address the issue of health care costs, the finance minister tabled an expert-panel report. Chaired by Wendy Thomson, the report, called Pour que l’argent suive le patient, recommends a patient-based funding strategy.
The details of the “comprehensive strategy” were not outlined on Thursday, except to say that it would address the current challenges, such as access, quality and appropriateness of care.
War on public service salaries?
Quebec pays too much to its public service employees
The budget hinted at a coming battle with Quebec’s public service unions. The government launched a missile into the union camp, saying that in 2013-2014, remuneration expenditures for public servants came to $37.3 billion, representing 59 per cent of government spending.
Under the current union agreement, which is set to be renegotiated at the end of March 2015, Quebec’s 430,000 public service employees received an average of 3.6 per cent in payroll increases per year between 2010-2014.
For the new agreement, the government “intends to set responsible remuneration with its employees.”
Christian Daigle, the vice president of the SFPQ, the union that represents public and parapublic service workers in the province, was unconcerned by the pledges in the budget.
“The government cannot make promises about the results of a negotiation which has not yet taken place,” he noted.
No more $7-a-day daycare in Quebec
Although the program was created by Premier Pauline Marois and has enabled tens of thousands of women to re-enter the labour market, the government said Thursday that Quebec parents have not been paying their fair share of daycare costs.
“When the initiative was started, the parents’ share was 20 per cent and now it’s close to 12 per cent,” Marceau said.
Parents currently cover 11.8 per cent of the cost ($7 out of total cost of $59.15 a day). As of September 1, 2014, the rate will be raised to $8, then to $9 in 2015 and indexed thereafter.
“We are doing it gradually, to avoid a large shock, if you will,” Marceau noted.
The CSQ, a union that represents over 130,000 daycare workers in the province, said Thursday that the 30 per cent increase is simply a tax hike in disguise.
“For a family with two children, it means an increase of more than $1000 per year.”
Fewer school boards
Quebec should integrate its school boards to save money
Quebec has 72 school boards: 60 French school boards, 9 English school boards and 3 special-status school boards, whose combined budgets total almost 10 per cent of consolidated government expenditure. Marceau said that he has noted major disparities in per-student costs in each school board.
“In general, the bigger a school board, the lower its per-student costs, suggesting that grouping some of the boards would generate savings.”
The difference between per-student-costs of school boards with between 5000 and 9999 students and those with at least 35,000 students is over $1000.
Although Marceau acknowledged that some disparities are explained by different factors, like students with adjustment problems, the location of the school and services for newcomers, he said that “the government is convinced that economies of scale are possible.”
By integrating school boards, the government hopes to save approximately $125 million, which it said it would reinvest in student services.
“We don’t count beans, we educate students,” the Quebec English School Boards Association told Global News on Thursday afternoon.
None of the English school boards in the province have more than 35,000 students.
In full: Government highlights from the budget
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