Quebec Finance Minister Nicolas Marceau will table a budget Feb. 20, setting the course for an election that could be called shortly afterwards.
“The budget will be an opportunity to take stock of the state of public finances and government actions to sustain the economy,” Mr. Marceau said in a press release.
There have been persistent rumours that Premier Pauline Marois was tempted to call an election in early March for a vote likely in April, sometime before Easter.
Opposition parties have been pressuring the government for a budget before an election and will finally get their wish. The last budget was tabled in November 2012, two months after the Parti Québécois formed a minority government.
The budget will be tabled around the same time the provincial auditor tables a report, demanded by the opposition parties, analysing the PQ government’s economic update released last November.
Coming on the eve of a possible election, the budget will likely be more of a political statement that will outline the economic perspective which the PQ will use to seek a majority government.
The last time a budget was tabled just before an election call was in 2003, when Ms. Marois was finance minister under Bernard Landry’s PQ government.
After the Liberals won that election then-premier Jean Charest appointed a former provincial auditor Guy Breton to examine the state of the Quebec finances and uncovered a $4-billion shortfall.
Mr. Marceau said that during the last few months the pre-budgetary consultation process yielded several proposals from various sectors of Quebec society to determine the priorities the government intends to adopt in next week’s budget. Several questions were raised with respect to social services, the need for more private investments and the creation of wealth to maintain services, he said.
Last November the PQ government announced in its economic and financial update that it had to delay reaching a balanced budget by two years because of the shortfall in government revenues.
Instead of balancing the budget by the end of the current fiscal year, which ends March 31, the government projected a $2.5-billion deficit. In 2014-2015 fiscal year the deficit is estimated to drop to $1.7-billion and finally be eliminated the following year.
However the deficits include savings the government planned to pay into the Generations Fund that was set up by the former Liberal government to eventually help bring down the debt. When subtracting the savings paid into the fund, the actual deficit was estimated at $1.4-billion for 2013-2014 fiscal year and $454-million for the 2014-2015 fiscal year.
The financial and economic update also calculated the province’s gross debt at $191-billion or 53.6-per cent of the province’s gross domestic product (GDP) as of March 31, 2013. The figure does not include the government’s financial and net assets.
The federal government on the other hand calculates its debt based on the accumulated deficits. When Quebec uses the same standard as Ottawa, the province’s debt falls to $118-billion or 33 per cent of GDP as of March 31, 2013. This is about the same level of debt-to-GDP as the federal government.
Regardless of the method of calculation, Quebec remains the most indebted province in the country, an argument which has often been used in recent years to justify austerity measures and cutbacks in government services. This would be an unlikely scenario on the eve of a possible election where the PQ government will likely seek innovative ways to seduce voters in next week’s budget.