Low profile for federal budget at Liberal lovefest

We are in the middle of a two-week parliamentary recess when Liberal MPs and cabinet ministers are roaming far and wide to sing the praises of the new federal budget. The finance minister even took the budget message all the way to Paris, where, according to the news release from his department, Bill Morneau was “…in France to Promote Canada’s Plan for Growing the Middle Class.”

Given such efforts to spread the word about the budget, it’s a bit strange that when the Prime Minister visited Halifax on the weekend the budget was barely mentioned.

Justin Trudeau pressed the flesh and posed for photos with the adoring and the curious at the Halifax Farmers Market. He also addressed the Nova Scotia Liberal annual General Meeting about the obscure topic of party organization. Local Xpress, the on-line news service maintained by locked-out Chronicle-Herald journalists, aptly summed up events with the headline: “Lots of Love but no news during Trudeau’s visit to Halifax”.

The budget, apparently of great interest in France, was dispensed with in Halifax via a reference to keeping Old Age Security eligibility at 65 and re-opening the Veteran’s Affairs Office in Sydney. The most likely explanation for the low profile is that Trudeau did not want to confuse the Liberal faithful and embarrass the McNeil government. After all, the provincial Liberals have made austerity their main – and some would say only – policy imperative. Trudeau’s first budget and its $30 billion deficit is a glaring contradiction, if not an outright repudiation of 2 ½ years of Liberal rule in Nova Scotia.

Realization that Trudeau, their political meal ticket, is on another wave length may already have the McNeil Liberals scrambling to make themselves look progressive. Day care is a case in point. McNeil kicked off the AGM with the announcement that the spring provincial budget would contain improvements to inadequate day care subsidies and the rock bottom wages of day care workers. The good news announcement followed the release the previous day of a government report on early childhood education. That report was the product of a quiet review that began under the NDP, giving Friday’s quick embrace of the report’s recommendations the appearance of a grab for some progressive low-hanging fruit.

Needs based Infrastructure

Aside from its inconsistency with the provincial Liberal message, the federal budget may have been given scant attention on the weekend because there’s not much in it that’s aimed at Nova Scotians. Like fellow Canadians, many will applaud budget measures like the Canada Child Benefit, the commitments to First Nations and increases in the Guaranteed Income Supplement for seniors. But beyond that, there’s nothing in the budget that would be seen as a reward for the solid backing Nova Scotians gave the Trudeau Liberals in the last election.

Take health transfers for example. Those nasty old Harperites changed the funding formula to the Maritimes’ great disadvantage in order to appease their western base and balance the budget. The Liberals have no western base and they’ve consigned balancing the books to Never Never Land, but the $30 billion deficit notwithstanding, the budget gave no indication that fixing health transfers is in the offing. So for 2016-17 at least, Nova Scotia’s transfers from Ottawa remain basically flat.

Then there’s infrastructure spending. That was a big item in the Liberals successful election campaign. Justin Trudeau’s promise to run modest deficits in order to pump $5 billion a year into infrastructure spending to kick start the economy was the turning point in the campaign. It was presented as an immediate response to pressing economic circumstances, in contrast to the balanced-budget tax-cutting approach of the conservatives and the balanced-budget go-slow approach of the NDP.

At $6.6 billion over two years, the budget falls short of the campaign promise. How much of the diminished infrastructure spending will find its way to the economically challenged Maritimes is unknown, but the initial numbers are not promising. The biggest chunk of change going out the door in Phase I of the infrastructure program – almost $3.4 billion – is for public transit. Forty eight per cent of that money will be going to Ontario, 27% to Quebec and 24% to Alberta and B.C. The Atlantic Provinces will get 1.4% between them, with most of that coming to Nova Scotia.The reason for the disproportionate distribution of the transit infrastructure cash is that rather than being distributed on a per-capita basis – which would net Nova Scotia $88 million instead of $32 million – is that the distribution is based strictly on ridership.

If public transit is considered a public good, maybe largely rural provinces like the Maritimes, Newfoundland and Saskatchewan could use more than a few crumbs to boost ridership and reduce the car travel in rural and suburban areas. The ridership-based approach leaves them in a kind of Catch 22. But obviously eschewing the per capita approach to transfers to take ridership – or need – into account makes sense. But then again, so does modifying per capita health transfers to consider need based on age and health status, a principle that isn’t gaining traction with the federal Liberals because of opposition from some provinces. As the saying goes (sort of): “What’s sauce for the transit goose should be sauce for the health care gander.”

According to several media reports, McNeil took advantage of Trudeau’s visit to discuss some form of federal help to replace the Victoria General Hospital. One wonders whether McNeil thought to point out that we wouldn’t need to ask for a special hospital deal if the Liberals would simply reverse the Harper government’s inequitable transfer formula.

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About Richard Starr

RICHARD STARR has had careers as a journalist, public servant, broadcaster, political staffer and freelance policy adviser. He is author of numerous newspaper and magazine articles, appearing in everything from Atlantic Insight to Atlantic Progress. A lifelong student of Maritime history, Starr is married to playwright and former MP Wendy Lill. They live in Dartmouth.
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