With just one week left until election day, all three major parties have now released fully costed platforms and former parliamentary budget officer Kevin Page says only the Liberal plan deserved a good grade for overall fiscal credibility.
The Institute of Fiscal Studies and Democracy (IFSD) at the University of Ottawa, where Mr. Page is founding president and CEO, rated all three platforms in three areas: realistic fiscal assumptions, fiscal management and transparency. Each category is scored as either good, pass or fail and additional analysis is provided.
The IFSD gave the NDP and Conservative platforms a passing grade over all, and the Liberal document received a higher score of “good.”
The NDP’s plan is the largest by far in terms of new spending and tax hikes. The party proposes to spend $38.5-billion over five years on a national pharmacare plan, plus $11-billion more for dental coverage, as part of a platform that would expand government spending by $214-billion over that period.
To pay for part of it, the NDP proposes $166-billion in new tax revenues, including expanded levies on capital gains, corporations and a wealth tax, which would add a 1-per-cent tax on those with more than $10-million in wealth, measuring elements such as property and investments.
“We’re going to invest in people in really bold ways,” NDP Leader Jagmeet Singh said on Saturday when the platform was released.
In the IFSD report released Sunday, the NDP platform was rated high by Mr. Page’s institute for realistic fiscal assumptions and passed on fiscal responsibility, but got a failing grade on transparency. Though many of the party’s revenue plans had been costed by the current Parliamentary Budget Officer, Mr. Page said very few spending plans went through the same assessment.
The institute also says the NDP fails to explain how it would implement large programs that overlap with provincial jurisdiction, nor does it assess the potential negative economic consequences of large tax increases.
“It’s an ambitious platform. There’s more ambition in this platform than in the Conservatives’ or in the Liberal Party’s,” said Mr. Page.
“They’re just trying to do a lot,” he said. “It’s a big spend document.”
Though Mr. Page said it’s a positive thing that the NDP has built in contingency funds to help buffer the unknown effects of these big programs, he said the institute did have concerns about a few aspects. One was that the costing is dependent on raising a wealth tax, among other measures, and that it may be difficult to raise taxes “in this environment.” He also said that this structure is unlikely to be sustainable over the long term as demographic shifts will put greater burdens on programs such as pharmacare.
Nevertheless, Mr. Page said the NDP’s platform costing is “a serious document” and warrants a passing score.
The party platforms are based in part on assessments by current PBO Yves Giroux and his team, which have a legislated role during elections to independently assess the estimated fiscal impact of specific spending or tax proposals at the request of parties. The current PBO does not provide any comment on the platforms as a whole, which is the focus of the IFSD’s work. The IFSD team includes several former senior PBO officials.
Mr. Page’s team gave the Conservative costed platform a passing grade overall, but a score of “fail” under the category of responsible fiscal management.
The institute’s main concern is that most of $60-billion the Conservatives plan to spend on increasing the Canada Health Transfer (CHT) would only come in years five through 10 of a Conservative government. Conservative Leader Erin O’Toole is also saying he will balance the books over a decade, but the institute said the platform doesn’t explain how health spending can rise sharply while the deficit shrinks.
“The CHT escalator of at least six per cent, if ongoing, would put the long-term balanced budget target and long-term fiscal sustainability at significant risk,” the institute wrote. “The six per cent increase to the CHT may require significant reductions to other spending measures or increases in revenue measures to maintain fiscal sustainability.”
The NDP offered no comment on the report when contacted Sunday night.
When asked about the IFSD report, Mr. O’Toole said his plan is about creating jobs and growing the economy, which will help balance the books.
“The Parliamentary Budget Officer confirmed our plan. We submitted 30 different policies for his analysis and we will balance the budget within the decade. We will make record investments in health care and our spending in the short term is about getting people back to work,” he said.
While the institute rated the Liberal platform as “good” across the three reviewed areas, it noted that the platform risks overestimating new revenue from increased tax enforcement and could be underestimating the cost of its climate-change plan.
When asked Sunday how realistic the NDP’s platform is, Liberal Leader Justin Trudeau said it is the job of Canadians and the media to analyze the various promises. He also said there are tough choices that come with governing.
“Governing is choosing,” he said at an event in Candiac, Que. “It’s about making really difficult choices about what is the best way to both support Canadians and ensure a better future.”
Mr. Trudeau said he stands by the Liberal record of progressive politics while “the NDP are making choices that I don’t think stand up to closer scrutiny.”
Mr. Trudeau was also questioned on whether there is an argument to raise taxes on the wealthiest and big corporations to raise more money for government programs.
“Yes, we have to have a progressive tax system,” he said. “Yes, we have to make sure that the wealthiest are paying their full and fair share. And we’ve done significant things towards that. But the idea that you can go with unlimited zeal against the successful and wealthy in this country to pay for everything else is an idea that reaches its limit at one point. And I don’t think the NDP get that.”
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