Winnipeg Free Press - PRINT EDITION

Flaherty to make cuts

60,000 civil-service jobs, CBC on chopping block

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OTTAWA -- Public servants and CBC devotees will watch today's federal budget with more attention than usual, waiting to see if Finance Minister Jim Flaherty's axe is going to fall on them.

This is the first real budget Flaherty has crafted with a majority government behind him and he's expected to unleash a world of hurt on some government sectors. The public broadcaster and MPs themselves are set to take some of the biggest hits as Flaherty cuts between $4 billion and $8 billion from the federal government's bottom line.

MPs -- often targeted for making cuts but not taking them -- will have their pay cut, face changes to their publicly loathed pension plan and see reductions to various office operating costs, such as fewer first-class flights.

Reforming public-service pensions is also on the table as the government moves to make costs more affordable.

As many as 60,000 federal civil service jobs might be cut, though many might be absorbed through attrition.

The CBC is expected to see its budget slashed by 10 per cent. There will also be changes to Old Age Security, legislation affecting environmental reviews for new resource projects and a move to rejig the distribution of science and technology grants.

Flaherty said cuts would come from federal programs, not from health, education and social transfers to the provinces.

"We're not touching any of that," he said.

Indirect costs could be loaded onto the provinces, such as the extra money Manitoba will have to spend to implement the government's new justice bill. Manitoba Premier Greg Selinger said he is worried about those indirect costs and the effect on the provincial economy of federal civil service job losses.

"The potential reduction in Old Age Security, that's a download," he said. "Tightening EI rules is another download on the provinces."

Raising the retirement age to 67 from 65 would mean the province has to shoulder social costs for senior citizens for two years longer before federal government programs kick in. Any changes that reduce employment insurance would also boost the number of people looking for help from provincial welfare.

Selinger said he wants to see new money for education and running water on First Nations. Those may be among the only new spending items in the budget. Some reports have suggested about $130 million will be set aside for education on reserves as the government moves to meet some of the recommendations of a government-commissioned report earlier this year.

"It probably won't be enough but it's better than a kick in the head," said Selinger.

Pukatawagan First Nation Chief Arlen Dumas said if the government doesn't set aside new money for education, water and housing in the budget it would be an indication the commitments it made at January's meeting with chiefs were just window dressing.

mia.rabson@freepress.mb.ca

Republished from the Winnipeg Free Press print edition March 29, 2012 A3

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Updated on Thursday, March 29, 2012 at 12:31 PM CDT: corrects typo, adds fact box

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