VANCOUVER — In last week’s Throne Speech, the B.C. government committed to make life more affordable for young people by investing in child care. Prioritizing new public spending for younger generations make sense now because young people’s wages are down 13 per cent compared to the mid-1970s, even though they are twice as likely to have a post-secondary education. With lower incomes, they must pay home prices that are 150 per cent higher than a generation ago.
Regrettably, the budget delivered Tuesday delivers almost no increase for young people. The child-care announcement made allocates an extra two dollars and 40 cents per young person next year.
Interestingly, the same budget added $1.6 billion to medical care spending over two years — spending which primarily benefits the generation of retirees, adding more than $1,000 a year per British Columbian over 65.
The problem is, annual government spending per retiree is already around $45,000 in B.C., compared to just $12,000 per British Columbian under age 45. In response, the Generation Squeeze Campaign, supported by a large network of partners from business, labour, social services, and the academy asks government to narrow the generational spending gap slightly by increasing expenditures on younger generations from $12,000 to $13,000 — $1,000 per young person.
The budget did the reverse. It added more than a $1,000 per retiree, leaving younger citizens further behind.
By widening the generational spending gap, the budget fails to address how B.C. is now the least affordable jurisdiction for young people in the country. The province has become unaffordable, because "B.C. young people suffer the largest reduction in household incomes of any province since the mid-1970s, along with the greatest increase in housing prices," observes Stephen Butz, CEO of the YMCA of Greater Vancouver, and an advisor to the Gen Squeeze campaign.
Adjusting for inflation, the average price of housing in 1976 was $209,000 in B.C. Today, it is $561,000.
The B.C. Liberal and NDP parties have both said that the province cannot afford $10-a-day child care, which is key to narrowing the generational spending gap. "But building this program would only raise spending per young person to $12,500," observes Anita Huberman, the CEO of the Surrey Board of Trade and another advisor to the Gen Squeeze campaign.
"This is affordable while still leaving spending on retirees around its current level," she adds.
Given the spending announcements, we need to ask: why $1.5 billion is unaffordable for $10-a-day child care when more than that amount was available to add to medical care? This question is fundamental now when B.C. already spends around $28 billion a year on medical care. It’s more relevant still when we read international comparisons that show Canada spends more money per person on medical care than most countries, only to achieve average or below-average health outcomes.
Truth is, the time has come to question the value of any further medical care increases until we grapple with the research that shows the additional spending hasn’t built the long-term community care needed by our aging family members so they spend less time inside of hospitals and which shows the same medical care increases have cannibalized spending on younger generations.
Regrettably, this is not yet a debate between the two main rivals in the upcoming provincial election. Instead, both the B.C. Liberals and NDP are striving for campaign success by adding more inefficient medical care spending on the backs of young people, while claiming the cupboard is empty when it comes to investing in those young people.
The result? This budget decision pits spending on the health of parents and grandparents against investing in their kids and grandchildren. By dividing generations this way, we make it far harder for young families to afford enough time at home with their children, and harder for young families to make enough time for the labour market because they can’t find or afford child care services.
A large network of partners have come together under banner of the Generation Squeeze Campaign to make the generational spending gap a key issue in the upcoming election (see gensqueeze.ca). The campaign aims to give all generations a chance, including Gens X, Y and Millennial. A chance to deal with lower wages, higher living costs, environmental change and an imbalance in government spending without compromising the family they have, or the family they want.
B.C.’s latest Budget fails to deliver this chance.
Paul Kershaw is a University of British Columbia professor of public policy, and the founder of the Gen Squeeze campaign.