Tories challenged on budget figures

By: Kristin Annable Posted: 8:27 PM CDT Wednesday, Jun. 8, 2016 Last Modified: 8:50 PM CDT Wednesday, Jun. 8, 2016 | Updates

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Premier Brian Pallister and his finance minister are facing accusations of misleading Manitobans when it comes to the savings found in their first budget.

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Premier Brian Pallister and his finance minister are facing accusations of misleading Manitobans when it comes to the savings found in their first budget.

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This article was published 08/06/2016 (3441 days ago), so information in it may no longer be current.

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Premier Brian Pallister and his finance minister are facing accusations of misleading Manitobans when it comes to the savings found in their first budget.

Finance Minister Cameron Friesen claimed when he unveiled his budget last week to have found $122 million in savings and promised to produce a list to show how the Progressive Conservatives found savings where the Selinger NDP government could not.

The Tories produced a partial list Wednesday after repeated media requests for an accounting of the savings.

JOHN WOODS / THE CANADIAN PRESS FILES
Finance Minister Cameron Friesen claimed when he unveiled his budget last week to have found $122 million in savings, but the Opposition has disputed that claim. — JOHN WOODS / THE CANADIAN PRESS FILES Finance Minister Cameron Friesen claimed when he unveiled his budget last week to have found $122 million in savings, but the Opposition has disputed that claim.

“We have a bit of a breakdown to give you and clearly you’ll want more,” Pallister said before Friesen stepped up to the podium to give a verbal list.

Friesen reiterated the more than $40 million saved from the clawback of the seniors’ tax rebate, $4 million saved from reducing cabinet, $1 million from by administrative changes to the school tax rebate, which were previously announced, and added in a new $7 million in so-called savings by not granting funding increases requested by post-secondary institutions. The list still comes up about $70 million short.

“We are not making excuses, but this is a government that has a great deal of work to do,” Friesen argued, noting they prepared the budget in six weeks.

The Conservative budget projects a deficit in 2016-17 of $911 million.

The Opposition NDP argue Pallister is misleading Manitobans.

“For a government elected on the premises of being more transparent and more accountable than our government was, I think they have done themselves and the people of Manitoba a great disservice by simply not coming clean with the obvious answer. Instead they want to dig the hole deeper and deeper,” NDP finance critic James Allum said.

“It was important for only their political posturing to create a crisis and then to show they had done something about it — hence the $122 million in savings. The fact of the matter is they haven’t been able to articulate what those savings are.”

Friesen, Pallister and Olivia Baldwin-Valainis, the premier’s director of communications, all have a different answer to how the savings number came to fruition.

Friesen said on budget day it was by “looking hard and working long hours.”

Pallister said Wednesday the $122 million represents a decrease in the core deficit from the forecast — but did little to explain how the Tories decreased the deficit.

On Monday, Pallister said the savings were found by not giving departments their full requested amount, promising a list of highlights to explain.

“For example, the request — we can find out what the request was for intravenous drugs, let’s find out what that was, it might have been to increase it by $8 million. We’re increasing it by four (million) — that’s a $4 million so-called savings. There are numerous requests like that,” Pallister said.

Baldwin-Valainis sent an email statement on May 31, explaining the figure came from two factors: an increase in revenue of $52 million and lapse, which refers to a $70-million budget line item that allows for the accounting of unspent funds. That same $70 million budget line can be found in the NDP’s last two budgets. On Wednesday she revised her statement, calling it “net reductions in planned growth to the tune of more than $120 million.”

Allum said the lapse line in the budget should never be considered “savings.”

“Lapse money happens year over year, and happens regularly because some project isn’t quite complete or doesn’t get built and that is in the normal course in business,” he said.

“That is the undoing of this political number right now, to try and take political credit for something that is merely standard operating procedure.”

kristin.annable@freepress.mb.ca

Budget background

Here’s how it all went down:

Finance Minister Cameron Friesen is asked during budget lockup on May 31 to explain how the province found $122 million in savings. The question comes from a line in the news release that states: “Budget 2016 reduces Manitoba’s core deficit by $122 million, a 12 per cent improvement over the 2015-16 forecast.”

Friesen points to the clawback of the seniors’ tax rebate ($46 million), the smaller cabinet ($4 million) and other “efficiencies.”

“How does a government that is just six weeks old manage to find $122 million? You look hard and you work long hours,” he said.

When it is pointed out those savings do not equal $122 million. Friesen states, “You start to add up all these things in other areas, we will be sure to quantify that for you.”

The media asks Friesen to provide a list to show those savings.

When no list is provided that day, Free Press columnist Dan Lett emails communications director Olivia Baldwin-Valainis, asking her to further clarify the figure and the savings.

She replies: The $122-million change in deficit reduction from forecast to budget relates to a $414-million revenue increase, which is a $52 million difference from the $362-million increase in expenditures. Add to that $70 million built into each budget as in-year adjustment or lapse — this could be savings or pickup in revenue.

Translation: The figure is made up from an expected revenue increase of $52 million. The rest is made up from the $70 million “lapse” budget line. A budget line used to account for unspent money from projects and other areas. The NDP’s budgets in 2015 and 2014 also included a $70 million lapse.

The next day, Friesen heads to a Manitoba Chambers of Commerce event, where without being prompted told media, “We’ve been able to already find $122 million in savings.”

Premier Brian Pallister is asked about the $122-million savings on June 6. After a lengthy scrum with the media, Pallister contends the saving figure came from not granting requested increases to various departments. He promised to provide a list of highlights to quantify it.

“I’m trying to comply for clarity. I’m trying to comply. I’m also trying to be cognizant that we have our ministers all going into estimates later this week. So, to be fair, I don’t want to put a big load on them to give you 17, 25, 38 pages of minutiae,” Pallister said.

On Wednesday, Pallister admits in question period the number is the reduction in the core deficit from the forecast, but reiterates it is made up of savings. After question period he tells media a list will be in “your hands soon.”

Friesen produces what he calls a “verbal list” that includes several already announced savings. He is still around $70 million short.