Sask budget: steady growth or no growth?
By Tatenda Chikukwa
Photo by Tatenda Chikukwa. Finance Minister Ken Krawetz relays the balanced "Steady Growth" 2014-15 budget at a news conference.
Saskatchewan has made it into the green zone by just a hair or, more precisely, $71 million when it comes to the 2014 provincial budget. With revenue at $14.07 billion and expenses at $14 billion, it is not hard to see why the province is tightening it belts or, should I say, vintage hand-me-down shoes?
It's not easy being green
Saskatchewan Premier Brad Wall and finance minister Ken Krawetz were pleased to present a balanced budget based on a theme of “Steady Growth” to the legislature. The minister said Saskatchewan's boom and bust cycle is behind us and that the over 19, 000 increase in population suggests new growth in the provinces future.
Krawetz said this year’s revenue was considerably lower at 0.7 per cent from last year but it would not mean any increase in taxes. The finance minister said some tough decisions had to be made like cuts to the heritage fund, but that ultimately increasing taxes will always be the last resort.
The government decided to tackle the $3.8 billion in operational debt by not investing in the Heritage Fund as predicted.
Krawetz said the cabinet and caucus would only look at creating the fund if wind-fall revenue from non-renewable resources exceeded $ 3.1 billion. They have instead made a commitment to pay down $400 million in debt by 2017.
But not investing in this fund impedes the Saskatchewan's government's plan for growth according to the opposition.
Share the wealth
NDP finance critic Trent Wotherspoon said it was disappointing for the government not to heed advice from Dr. Peter MacKinnon, the government's heritage fund adviser, who called the budget a lost opportunity to save money for future generations.
“Today’s budget only has cuts and crumbs for Saskatchewan families,” said Wotherspoon.
Wotherspoon said the strong economy will only benefit government and not families, noting that the budget cuts healthcare, despite having over 50 per cent more revenue coming into government coffers.
The NDP is critical of the government's 20 per cent cut to the educational capital budget. The opposition party insists the government is not meeting the educational needs for a growing population.
Wotherspoon criticized the allocation of millions of dollars to standardized testing instead of teaching, educational assistants and reduction of class sizes.
Lean on healthcare
Meanwhile, funding of nearly $5 billion to health care will be invested in improving surgical waiting lists, support for primary care centers, innovative homecare and reduction of ER wait times, all significant problems that dominated the Saskatchewan news cycle this year and last.
The budget addresses concerns for senior’s long term care facilities by allocating $4.5 million to the Home First homecare program and $ 3.7 million to the Seniors’ Care Urgent Issues Action Fund.
Impressive as this may be on paper, the NDP said that $ 3.7 million is old news and that no new funding has been given to long term care.
“When I hear stories about seniors who are in long term care beds, who do not have help to get to a bathroom, when I hear stories of families having to pay a thousand dollars a week to hire a private care needs just to insure that their loved one can get to the bathroom and have some help with meals, that tells me that there aren’t enough staff,” said NDP leader Cam Broten.
Broten wants money taken away from the “Lean” initiative's Japanese senseis and put into more frontline healthcare worker programs.
He said the Saskatoon health region’s urgent request identified a need for 450 more care needs workers in order to have dignified caring for their residents.
The “Lean” initiative has been criticized for spending $40 million dollars on a U.S. consulting agency for efficiency management in health care. Opposition leaders say the cost is too much and government must work directly with frontline heath work and not go though intermediates.
A format for cooperation
The only thing the parties could agree on was the new summary budget format.
This year the budget was separated into summary-based information and the core operations plan. The summary is a subset of the General Revenue Fund which in turn is a subset of the Core Operations Plan.
The Core Operations Plan is the plan for the General Revenue Fund and in that plan all public monies a
re paid except for the monies that government has assigned to school boards, health authorities and Crown corporations. Any expenditures of the Core Operations Plan therefore require legislature approval.
University of Regina political science professor Jim Farney said the summary budget format is better because it is the best practice and industry standard. But whether it truly represent a balanced budget remains to be seen. “In our case, it may have allowed the government to balance the budget while borrowing through the crowns, but it will really take an auditors report to see that,” he said.
“We’ve been calling for a shift to summary finances. Nothing short of that would have been acceptable. The position they had taken was entirely unsustainable and we are pleased to see that step but what we are going to do now is track that governments changes through to implementation and to make sure that Saskatchewan people have the honest transparent books that they deserve,” said Wotherspoon.
The summary budget format was suggested by the Provincial Auditor to encourage transparency and avoid the confusion of last year’s $ 53 million deficit scandal - but the new format was confusing to the public and journalists alike.
In a morning press conference Krawetz addressed the confusion. He said he is not sure that the summary format will help people understand the budget but it will offer them a transparent overall look at Saskatchewan’s spending. “We want to be able to show the people of Saskatchewan the overall position of the financial activities in the province,” said Krawetz.
This year’s budget was quiet and conservative. No big shockers were delivered. Krawetz said he is satisfied with the budget and is proud of the progress made with a lot of initiatives, but said he knows there are still more needs to be addressed.
