Quebec Premier Jean CharestRyan Remiorz
Quebec is emerging from the recession in far better shape than most economies, says Premier Jean Charest, adding that he can avoid slashing government programs and elude major tax increases yet still achieve a balanced budget in four years.
Mr. Charest anticipates the province will generate enough additional revenues from hydro-electricity exports and use renewable resources to attract industries as part of the "new economy" that massive cuts in government program can be avoided.
But he acknowledged that given the province's heavy debt and limited resources, balancing the budget will be a perilous exercise at best, one that every government will eventually have to undertake. Quebec doesn't have all the answers but then no one does, Mr. Charest insisted.
"Has Barack Obama figured that out? Has Stephen Harper done that? Has Dalton McGuinty done that? Has the President of France done that? Well the answer is 'No.' And why? Well because we are just coming out of an economic crisis. In our case we are actually more advanced than most other governments on this issue," Mr. Charest said.
Quebec legislation adopted last fall requires the government to balance its books by 2013-2014 fiscal year. Until then the government was projecting annual deficits of over $4-billion a year.
Prime Minister Stephen Harper said provinces will need to follow Ottawa's lead and introduce major cuts in program spending. Mr. Charest disagrees, saying that Quebec is way ahead of the game.
"Over the last six years Quebec has been well below the Canadian average, (spending) at 4.6 per cent on an annual basis compared to 7.6 per cent for other provinces. Actually, increases in our program spending have been below the average of the federal government over the last few years," he said.
Mr. Charest made his remarks at the conclusion of an economic forum where over a hundred business, labour and community leaders were convened to examine the major issues facing Quebec over the next 20 years in anticipation of a slow economic recovery.
During the deliberations, Jacques Ménard, president of BMO Nesbitt Burns, had trouble containing his impatience over the government's handling of rise of the province's public debt and the impact it was having on the economy.
"Servicing the debt represents 10 per cent of total government spending and in four fiscal years it will represent 14 per cent," Mr. Ménard said, arguing that the government will have to examine news to finance the rising cost of health and education. "At some point we will have to tackle this major challenge."
Quebec has one of the highest debts in the country, estimated to be $150-billion. Finance Minister Raymond Bachand said he will soon release figures that are expected to show that the province's debt will increase to over $170-billion over the next four years.
Premier Charest admitted that while the province's debt in relation to the gross domestic product remained manageable, his government will need to define a plan on how to reduce it.
Yet the majority of business and labour leaders agreed that despite the province's tight financial situation, the education system needed significant improvements n order to face the labour shortages in the wake of an increasingly aging work force.
The head of the influential Quebec business lobby group the Conseil du patronat, Yves-Thomas Dorval, was convinced the province had no choice but to increase university tuition fees and pursue more private sector investments to modernize the province's troubled post-secondary education system.
Labour leaders argued that the next provincial budget will need to examine how to solve the dilemma of having to spend more on education without causing further harm to students ability to pay.
When the government first introduced the idea of holding an economic forum the objective was suppose tom examine how to deal with the province's shaky public finances. But Premier Charest backed away from the idea deciding instead to hold a larger less constraining forum on the long term future of the province's economy.
Opposition parties complained that the forum was nothing more than a public relations exercise aimed at diverting public attention away from Liberal government's growing unpopularity over its refusal to hold a public inquiry into allegations of corruption and political influence peddling involving the province's construction industry.
Rhéal Séguin