Wednesday October 01, 2014

QUESTION OF THE WEEK

  • What type of housing development would you like to see replace the East View Lodge building?
  • Assisted living
  • 52%
  • Personal care home
  • 6%
  • Low-income housing/apartments
  • 42%
  • Other
  • 0%
  • Total Votes: 31





Provincial deficit worse than predicted, while revenues exceeded expectations

Comments

It’s great this year’s provincial deficit is not as bad as the government’s current budget expected.

The booster class that cheers the NDP government no matter what they do must have let out a big sigh of relief when they heard that news.

But how do the government’s recent numbers compare with where they thought we would be when they made some predictions almost two years ago? In short, things aren’t as pretty.

If you blow off a thin layer of dust on the 2012-13 provincial budget and look at the government’s predictions for 2013-14 (this year), you’ll see they predicted expenses to exceed revenues – a deficit – of “just” $176 million.

That’s a far cry from the $432 million deficit recently announced by Minister Howard. In fact, it’s more than twice as bad as her government predicted.

Hmmm so what could be the problem? It must be something on the revenue side right?

After all, government loyalists routinely dismiss the allegation the government has a spending problem. Certainly revenues must not be as high as the government thought they would be when they made the prediction.

Yet, if one thumbs through the 2012 budget you’ll find the Selinger government thought its revenues would be $14.34 billion for this year, but we’re actually on pace for $14.46 billion; about $125 million higher than expected.

The answer to the problem seems to lie with some information below the revenue line in the budget – the expense line. The government is on pace for expenses that are $153 million higher than projected in the 2012 budget.

If you go back and review each budget since the NDP took office you’ll find that almost every year the government spent more than budgeted.

Like kids in a candy shop with their allowance burning a hole in their pocket, the Selinger government simply can’t control spending. The numbers we’ve just cited can’t be blamed on the economic slowdown from 2008, they can’t be blamed on the flood of 2011 or even on the government’s favourite scapegoat – former Premier Filmon.

Anecdotally the Canadian Taxpayers Federation, a donation-based taxpayers’ watchdog organization, has heard of bureaucrats on the inside of government expressing shock with how easily the NDP government agrees to spending requests.

It sounds like more often than not, spending requests get rubber stamped without much in the way of pushback; like scaling back a project or delaying non-urgent requests.

From the outside looking in, it certainly seems to be the case.

Someone wants funding to expand the convention centre? Done. New stadium? Done. New polar bear house? Done. New park beside an existing park? Done.

Money seems to be no object to this government.

Just don’t look at the province’s debt, this year Manitoba was supposed to pass the $30 billion mark and end up around $30.1 billion. Yet now we’re now on track for $30.3 billion; $200 million higher than expected.

When the Province releases its next budget in a couple weeks, just remember to ignore the government’s projections on future spending restraint. It’s almost never happened and it’s highly doubtful they’re going to start sticking to their promises any time soon.


Comments



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