Nearly 2 years ago, the Greene report called for cuts to public spending and privatization. What happened?
In May 2021, the premier's economic recovery team delivered its report
Remember the Greene report?
Almost two years ago, an "economic recovery team" appointed by Premier Andrew Furey released a plan to get the province out of what Moya Greene, the team's chair, called a "fiscal crisis."
The report was controversial — it recommended tax increases, spending cuts and privatization of some provincial assets. Some critics argued that major changes were necessary to ward off financial disaster, while others argued that the recommendations in the team's report amounted to austerity.
After the report was released, Furey vowed "urgent actions."
"Our province is spending more than we have. We are borrowing just to pay interest on what we owe. Over a billion dollars a year with nothing to show for it. Our credit card debt is out of control," he said.
But two provincial budgets later, many of the cuts to spending, higher taxes and privatization of provincial assets included in the report haven't materialized.
Theatrics?
Memorial University political scientist Russell Williams said the report has had limited influence on public policy, calling it "political theatre."
"Part of it was to simply build public support for the government sort of giving the public … tough fiscal medicine," he said Friday. "I think in that sense, it probably has had an important impact, but maybe less than the government might have wished."
Over the past two years, some recommendations found in the report have been sprinkled through provincial budgets and government announcements.
The provincial government slashed its post-secondary operating grants, restructured Crown corporation Nalcor Energy, began the process of folding the English school district into core government, and announced the four regional health authorities would merge.
The report also recommended a suite of tax and fee increases.
"This is a big part of the Greene report that got ignored right away by government and by a lot of the commentators," Williams said.
"None of those revenue proposals were ever taken seriously."
Three years left
After the report was released, Furey did say his government would not be implementing all the recommendations found in the report.
"We're lucky to have a report that has many solutions. We may not take them all. Of course we're not going to take them all," he said.
But Williams argued the Greene report prepared the public for restrictions — if not reductions — on government spending.
"Wage restraint in public services and public sector cuts have been real and they have had a big impact. Public services in this province are falling apart, right, whether we talk about the health-care system, ambulance services, the education system, whatever," he said.
The report also recommended selling off provincial assets, including the province's oil and gas holdings, registries, the Newfoundland and Labrador Liquor Corporation and Marble Mountain.
The provincial government commissioned Rothschild and Co., a bank and financial services company, to conduct a $5 million review of those assets to determine their value. The provincial government received a report from Rothschild and Co. last fall, but hasn't made it public.
And with about three years left in the Furey government's mandate, Williams said time is running out for some of the bigger decisions — like selling off assets.
"I think the window is kind of closing where we're going to see those kinds of things occurring. I think they may just fade into memory at this point," he said.
A 'much better' position
Provincial government spending was projected to reach record levels in the 2022 budget. Finance Minister Siobhan Coady attributed the spending to "strategic" investments in health care, along with hundreds of millions in "flow-through" money from the federal government.
Jessica McCormick, president of the Newfoundland and Labrador Federation of Labour, was one of the organizers of the People's Recovery, a group that offered alternatives to and critiques of the Greene report. She's in favour of that higher spending.
"We've been experiencing both health-care crisis and a cost of living crisis. So it has been very necessary for the government to to make those kinds of spending decisions," she said.
During the 2022 fall fiscal update, Coady announced the provincial government would post an unexpected surplus, driven by oil prices, tax revenue and inflation.
Coady said the surplus was fortunate, but wouldn't necessarily be repeated in the upcoming provincial budget. Still, while announcing a new European bond program last week, Furey said the province was in a "much better" financial position.
According to a press release about that program, the provincial government still plans to pass balanced budget legislation — first announced in 2021 as a way to balance the books.
McCormick is arguing against that legislation.
"We will see more restrictive measures that limit spending by provincial governments at a time when … that kind of spending to ensure that people have the economic stability that they need, you know, is necessary."
The House of Assembly reopens today, and the 2023 budget will be revealed later this year.
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