Richard Saillant, economist, tells Gallant government to be bold
Moncton economist Richard Saillant worries government will cave to special interest objections to cuts
A University of Moncton says he worries how much the Gallant government's strategic program review will accomplish given the backlash that is underway as special interest groups argue against cuts and increased taxes.
The government report called, "Choices to move New Brunswick forward," released just over a week ago lists more than $1 billion of possible cuts and tax increases.
Richard Saillant, the director of the Donald J. Savoie Institute at the University of Moncton, said there are a lot of good ideas in the plan.
So that's the main concern — I'm afraid we'll end up listening to a festival of objection.- Richard Saillant
"The document is a good document that provided a list of realistic options ... and it struck the appropriate balance between generating more revenue and lowering expenses," he said Monday in an interview on Information Morning Moncton.
Saillant said he is however concerned about the strategy and worried the government is opening itself up to "paralysis" by releasing the list of possible cuts and taxes nearly four months ahead of the 2016 budget.
"For the coming little while all we're going to be hearing about are lobbies and people who have an economic interest in the status quo who will have very, very convincing reasons why we should not be doing anything in their own backyards," Saillant said.
"So that's the main concern — I'm afraid we'll end up listening to a festival of objection."
Health Minister Victor Boudreau, the minister responsible for the strategic program review, said he appreciates that concern but his government felt it was important to give people in New Brunswick the opportunity to look at the strategic program review and voice their concerns.
"What my job is going to be ... is convincing New Brunswickers, 'OK, if you don't want to do this or you don't want to do that, then what choices in this report are you prepared to do,'" Boudreau said.
"But at the end of the day we were elected to govern and to lead and we will do that."
Saillant predicts the Gallant government will have to impose more of the proposals in the strategic program review than it thinks.
He says the idea that New Brunswick will return to a "world of rainbows and unicorns" after one tough budget is not realistic.
"We're on a fiscal treadmill for the next 20 years or so."
Boudreau says government must get this right
"There's no magic bullet, but we do know that for almost nine years now we've been leaving on the table $250 million worth of HST ... inaction does have a cost," Saillant said.
He says the government must not stop there, and has to move ahead with further cuts or tax increases.
"In the end we elect them to lead, we elect them to be accountable...it's about time the rubber meets the road and we have actual measures and sooner rather than later," he said.
Boudreau agrees, calling the fiscal situation in New Brunswick "dire," but he says the government has taken a year to come up with the report in an effort to make the best decisions possible.
"Interest on the debt is the fourth largest budget item in our budget, after the departments of health, education and social development and that cannot continue," he said.
The minister acknowledges the policy announced in the last budget, making unpopular changes to seniors nursing home costs, is the kind of "rush decision" that his government does not want to repeat.
"We're making sure we are getting this right," Boudreau said.
"It really is almost the opposite of what the situation was with the seniors policy where yes, you know, we rushed too quickly and we didn't consult enough."
The seniors policy changes were eventually cancelled.
Saillant says the target of $600 million in cuts or revenue increases is a reasonable one for the government.