At first glance, it seems counter-intuitive for a minority government on the eve of calling an election to hike the fees Quebec parents pay for daycare, one of the province’s most cherished social programs.
But make no mistake: Nicolas Marceau’s second budget is as electoral as it can get.
It addresses the Parti Québécois’s biggest weaknesses: its poor business credentials and its coziness with the province’s unions, which was recently highlighted at the Charbonneau inquiry. And in a populist bid to seduce more conservative-minded voters, it targets the groups that Quebeckers love to hate: “unproductive” public servants, “overpaid” doctors and “useless” school board commissioners, as they are often caricatured.
In one of the thinnest budgets in memory, where details on departmental spending were conveniently absent, Mr. Marceau tried to cast the PQ as Quebec Inc.’s ally.
The PQ will guard the province’s public companies against corporate predators. It will invest in oil exploration and mining to create what it promises to be a prosperous state, over the concerns of its green allies who have long demonized such industrial operations.
“Starting today, not only will we be masters in our own house, but we will also be prosperous in our own house,” Mr. Marceau said in reference to former premier Jean Lesage’s famous “Maîtres chez nous,” the slogan of the 1960s Quiet Revolution.
Mr. Marceau also attempted to depict his government as a sound manager of Quebec’s finances, which is undoubtedly the business community’s top concern. Unfortunately, though, there is little proof that Quebec is a master of its own house.
The acting auditor-general’s report on the Finance Minister’s assumptions, made on the eve of the budget, came back to haunt Mr. Marceau. Michel Samson concluded that balancing the books by 2015-2016 was an “ambitious objective” for Quebec, a euphemism that really means “unrealistic,” he conceded in a press conference.
Mr. Marceau is counting on a more upbeat economy that will bring in additional revenues and on a rigorous control of government spending to find the missing $2.5-billion – but he may fail on both counts.
The PQ hopes to limit the growth in overall government spending at 1.9 per cent over the next two years, whereas the growth rate of consolidated expenditures in the seven previous fiscal years has averaged 4.6 per cent. That looks about as realistic as trying to lose 15 pounds over the Christmas holidays.
Even assuming Quebec can accomplish this feat, Mr. Marceau is looking for $150-million in savings from efficiency measures that have yet to be identified in the next fiscal year. In fact, the main way Quebec can reach its revised target of a $1.75-billion deficit in the next fiscal year is by receiving more than $600-million in federal transfers.
As for 2015-2016, the year in which the province is expected to balance its budget, Mr. Marceau is still clueless as to where he will find the missing $530-million.
To its credit, the Parti Québécois finally had to courage to raise the daycare rates, which have been irresponsibly frozen at $7 a day since 2004 for government-subsidized spaces. Given inflation, parents now pay $5.89 per day in 2004 dollars.
The rate will rise as of next September until it reaches $9.20 a day in 2016, when it will be indexed to the cost of living.
By that year, though, the hike will bring in only an additional $125-million to the government. That money won’t even cover the cost of the extra daycare spaces Premier Pauline Marois promised as she extends the daycare system she created to 250,000 spaces provincewide.
Luckily, the government is not counting on the savings it hopes to wrestle from its public servants, including the province’s doctors, in its next round of collective agreement negotiations, which promises to be stormy.
Still, one cannot escape the impression that balancing the books within two years is an almost impossible tightrope-walking act. By pretending this daring feat can be accomplished without cuts in services or extra tax and rate hikes, the PQ is resorting to a tactic that is well known to retailers that sell sofas and TVs: Vote now, pay later.