That sound you hear from the legislature these days is the buzz of saws and scissors as public servants and cabinet ministers trim their budgets. It's about time.
Since 1997, core spending has gone up 126 per cent while revenues grew 92 per cent. Meanwhile, the Consumer Price Index, for the sake of comparison, rose 31 per cent during the same period. No special expertise is required to conclude that this trend can't go on.
The number of positions in the public service continues to rise. There were 422 more provincial employees last year than the year before. The government has pledged to cut the civil service by a modest 600, not enough to make the kind of difference required.
Cutting waste is not the same as protecting investments.
For example, depriving universities and colleges of the grants they need will hurt the provincial economy. Our post-secondary institutions have been chronically underfunded, and adding to that burden will only put this province further behind. A better strategy would be to allow the universities and colleges to charge tuition fees more in line with competitive institutions around the country.
The tuition freeze imposed by the NDP government for 10 years has taken its toll. The current policy of allowing tuition to rise at the rate of inflation has had little impact on a decade of damaging policy.
To its credit, the Selinger government has finally begun to control unsustainable cost escalation in the Health Department without compromising services. It can now do the same elsewhere. Governments do a poor job of assessing which programs are necessary and which are redundant or ineffective.
The provincial debt continues to grow, as do annual deficits. The only saving grace is that interest rates are at historic lows, protecting the treasury from a scary spike in debt-servicing costs. Just as every mortgage holder should do, the government has to prepare for the inevitable rise in interest rates.
Manitoba does not control all its revenue sources. Increasingly, we are dependent on transfers from Ottawa. In 1997-98, the federal government accounted for 32 per cent of Manitoba's total revenue; last year, it was 36.23 per cent. The equalization formula will be renegotiated in 2014; there are no guarantees.
If money is the biggest problem facing the government, training and recruiting a workforce is not far behind. The best public policy in Manitoba for the past 15 years has been the bold and impactful decision to recruit immigrants from all over the world.
In 1998, Manitoba welcomed 2,993 immigrants or 1.73 per cent of the national total. In 2011, that number was 15,962, or 6.42 per cent of Canada's total intake. This is an incredible success story, the envy of not only other Canadian provinces but countries around the world who admire our ability to recruit, retain and employ immigrants.
The impressive success of the provincial nominee program can be shared by the Chrétien and Martin Liberals, the Filmon and Harper Conservatives and the Doer and Selinger New Democrats. Just imagine if more public policy was developed in a bipartisan way, free of the petty and partisan bickering that takes up so much space in the political arena.
The bad news is that in 2012, the numbers went down for the first time in more than a decade. We admitted 13,391 immigrants last year. The reasons are that the federal government has capped the number of provincial nominee immigrants at 5,000, smaller families are coming to Manitoba, more stringent language requirements are keeping otherwise qualified candidates away and the Manitoba government is in the midst of figuring out how to access other streams of immigrants.
The co-operative approach that characterized the policy's success has given way to federal-provincial squabbling, especially since the federal government announced it was taking control of settlement services away from the provinces. The federal government pays for the bulk of those services, so it is understandable they want more control and credit. The most important issue is that high-quality services are not compromised. Both governments should be working to ensure Manitoba's stellar model is protected.
Finance Minister Stan Struthers has an opportunity to tell Manitobans on Tuesday that his government understands the looming threat of growing deficits and debt, and that he recognizes the imperative of training and enhancing the workforce. These two pillars are indispensable to our future prosperity.
Jim Carr is the president and CEO of the Business Council of Manitoba, a group of 71 CEOs of Manitoba's leading companies.
This is the last of a three-part analysis of Manitoba issues that should be addressed in the April 16 provincial budget.