Biz, labour clash over promise to balance books early

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This article was published 29/08/2019 (2247 days ago), so information in it may no longer be current.

Brian Pallister’s plan to balance the province’s budget two year’s earlier than scheduled has pleased the business community, angered labour and provided fresh ammunition to his political opponents, who have lambasted him for cutting services and slashing infrastructure spending.

The Progressive Conservative leader set a new target for getting the province’s books into the black at the televised leaders debate Wednesday evening. Instead of achieving a balanced budget by 2024, as he’d originally promised, a re-elected PC government would get the job done by 2022.

The Manitoba Chambers of Commerce welcomed the new timeline on Thursday.

“The fact that he thinks he’s able to do it in a shortened time frame is something that we would be supportive of,” said president Chuck Davidson.

Davidson said if the Progressive Conservatives hadn’t decided to reduce the PST a year earlier than expected, they may have accomplished their goal of eliminating the deficit this year. This year’s provincial operating deficit is expected to be $360 million.

Business leaders were disappointed when the PC party revealed shortly after taking office in 2016 that it planned to take eight years to balance the budget.

Pallister had, however, promised a gradual approach to eliminating the deficit in the last election.

“One of the first things he said when he got in was he would look at taking a responsible path to balanced budgets without putting jobs and services at risk,” Kevin Rebeck, president of the Manitoba Federation of Labour, said Thursday. “The second thing he did was break that promise.”

Balancing the budget two years ahead of schedule at a time of low economic growth is cause for concern, Rebeck said. The federation has advocated for greater government infrastructure spending to create more jobs. It’s also lamented the fact that 120,000 public-sector employees have had to endure wage freezes under the Tories.

On Thursday, the NDP pounced on Pallister’s new timeline, pointing to provincial budget documents that project a nearly $300-million deficit in 2022, should economic growth in the province fall below average. The Conference Board of Canada has predicted growth rates of less than one per cent for Manitoba this year and next.

NDP Leader Wab Kinew said Pallister needs to tell Manitobans what he’s going to cut to meet his new target. “How much worse is he going to make health care? What’s he going to cut from education?” he said.

Liberal Leader Dougald Lamont said the government’s economic growth projections appear to be overly optimistic, and eliminating the deficit sooner by reducing stimulus spending would be a mistake.

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“If we have a downturn (in the economy) and we have more layoffs and we have more austerity, it’ll just create a self-reinforcing negative spiral,” he said.

At a campaign announcement on Thursday, Pallister appeared confident that a re-elected PC government would be able to deliver on the revised budget plan.

“The greatest inaccuracy, I guess, that we’re responsible for is, frankly, we projected it would take eight years to balance the budget and we’re going to do it in six,” he said. “I would say our conservative estimates prove that we’re serious about hitting our targets.”

— with files from Jessica Botelho-Urbanski and Katie May

larry.kusch@freepress.mb.ca