Let nobody question the will of Ontario’s government to overhaul its finances - for now.
The budget introduced by Finance Minister Dwight Duncan on Tuesday is entirely absent new goodies of the sort that Dalton McGuinty’s Liberals spent their first eight years in office distributing; the most that can be said is that it preserves a few old favourites, such as full-day kindergarten and smaller class sizes. And it takes aim at much of what Mr. McGuinty has always held sacred, including the labour peace that has been pivotal to his political success.
Save for cancelling corporate tax cuts, it could mostly pass for a Progressive Conservative budget - which makes Tim Hudak’s flat rejection of it more than a little peculiar. Conversely, it may be too much for the provincial New Democrats to swallow, which means that the Liberals have placed their minority government in some jeopardy just months into its existence.
But if the budget passes, which remains the likeliest outcome, there’s a big caveat before declaring the province well on its way out of its deficit.
While there is no shortage of immediate cutbacks and revenue increases in Mr. Duncan’s plan - abandonments of planned infrastructure projects, cancellation of corporate tax cuts, freezes of base funding for hospitals - many of the big-ticket items will require sustained effort and focus, rather than just strokes of the pen.
Wage restraint, one of the budget’s centrepieces, fits that bill. The Liberals seem prepared to take a hard line in their current negotiations with the Ontario Medical Association. But their resolve, which includes a purported willingness to legislate salary freezes and other measures if they can’t be achieved through collective bargaining, will be tested by this year’s encounter with their erstwhile allies in the teachers’ unions - and again and again as contracts expire over the next couple of years.
Many other measures could similarly be described as long-term projects, as opposed to quick fixes. Reforms to public-sector pensions, to reduce future benefits if funds run short, are to be enacted only after consultation to develop a “legislative framework.”
Savings at universities are contingent on a new plan that, while due this summer, the government has been struggling to settle on. Closing underutilized schools, guaranteed to cause outrage in communities where it’s even suggested, will take years to sort out.
Perhaps most importantly, flattening health spending increases at 2.1 per cent annually - even more ambitious than the previous 3-per-cent target, which itself was met with great skepticism - will put the government in an endless battle with a veritable army of entrenched interests. And if it blinks any time in the next several years on what is by far its biggest area of program spending, all its deficit-reduction projections will collapse.
There’s little shame in patience and long-term planning. If there was one key takeaway from this winter’s much-ballyhooed Drummond Report - from which Mr. Duncan picked and chose recommendations - it was that overreliance on quick and deep cuts would do little to achieve sustainability.
But to the extent that the Liberals have prioritized policy over politics, that balance will be continually challenged by a minority legislature. The pressures to drop certain fights, to claim false victories in others, will ramp up as the province shifts into perpetual election mode - and that’s assuming the government survives this spring.
With every passing day, in other words, the sustained will on which Mr. Duncan has pinned his hopes will become more difficult to maintain.Report Typo/Error