Tories play politics with deficit

Opinion

Hey there, time traveller!
This article was published 18/05/2016 (3434 days ago), so information in it may no longer be current.

It was a curious way for a newly minted finance minister to make his debut. Cameron Friesen came out guns blazing Wednesday and accused his predecessor of misleading Manitobans on how bad the province’s finances are. Mr. Friesen said the government’s deficit for 2015-16 has nosed its way north of $1 billion.

And yet, Mr. Friesen refused to provide the details — numbers, numbers, numbers — to back up his “financial update.” Manitobans, then, will have to take his word — at least until the first Conservative budget is tabled May 31.

So, transparency, eventually?

Mr. Friesen was more than willing, however, to talk about the root of the problem, both the reason for the huge discrepancy in this deficit number (compared to what the former Selinger administration released just 10 weeks ago) and why Manitoba is in the precarious financial state seen today.

The spendthrift NDP, which consistently blew its budget projections, dug this hole, he said. Further, it had to have known when it presented its last financial update, just before the election campaign, it was “staring down” a billion-dollar deficit.

At that time, then-finance minister Greg Dewar reported the core deficit for 2015-16 was projected to hit $646 million. That, Mr. Friesen said, is roughly 50 per cent less than the truth of the matter. The financial update intentionally overestimated revenues and underestimated departmental spending, and the NDP chose to withhold the real numbers from taxpayers, he said. The NDP “put (its) organizational priorities ahead of the priorities of Manitobans.”

Mr. Friesen characterized his update Wednesday as an early release of information that typically comes in the fourth-quarter report of the province’s financial status. Yet he released none of the detail that accompanies such reports, which usually come in the fall. He did know the change in the bottom line — between the third-quarter report and his description of what the fourth quarter will show — has taken Manitoba into unchartered ground. “I don’t know that we have ever been here as a province before.”

He would be right on that point. If the billion-dollar deficit proves accurate, this is a high-water mark in the seas of red that have washed over Manitoba’s books in the last six-plus years. The last time the deficit for the government’s own operations reached anywhere near — but still short of that — was in 2011-12, when great gobs of cash went into fighting the historic flood of the Assiniboine River.

Still, the financial update Wednesday was no less a political accounting than was the financial update provided by Mr. Dewar in March.

There is lots of room in the provincial ledgers to move numbers around — accounting for spending and for expected revenues in different fiscal quarters and even between two fiscal years, for example. It allows governments of any stripe to massage the bottom line, curbing or inflating deficits. Indeed, the two numbers on expenditure overrun and revenue shortfall released Wednesday do not add up to the difference in the deficit projections now, compared to March.

This is why the auditor general forced the NDP government to move to summary reporting, which consolidates and reconciles all the numbers, including departmental spending, reserves, as well as the surpluses and deficits of Crown corporations and other entities.

Mr. Friesen refused to release any summary numbers Wednesday, although, with two weeks to go before he presents his budget, he must know them. Indeed, the summary deficit, pegged at $773 million by Mr. Dewar in March, may be looking a little better today. Mr. Friesen refused when pressed by reporters to talk about those detailed numbers, though.

The news out of the Pallister government was designed to focus on one thing: how bad things got under the NDP. And maybe that’s the truth. But for now, all Manitobans get to see is the Selinger legacy, according to a Conservative narrative.