A pledge not to tolerate deficit spending an early test for incoming Holt government
Party's billion-dollar platform to make balancing budgets a tall order
Liberal Leader Susan Holt will be sworn in as New Brunswick's 35th premier on Saturday, and one of the first things she has promised to do is pay New Brunswick nurses $10,000 retention bonuses, at a cost of an estimated $74.3 million.
The money, which Holt says will be delivered before January, will be an early test of her new government's duelling commitments to spend more freely on services, but not spill any red ink while doing it.
"We committed to getting that first retention payment out this calendar year, to recognize the work that nurses have done, and to ask them to stick with us as we put in place the changes to their working conditions they have been asking for," said Holt, on election night, about her intention to keep the promise to nurses.
But Holt has also pledged her government will not run budget deficits during her entire term — a potential conflict given the party's many spending promises.
On the morning after the election, Acadia University political scientist Erin Crandall told CBC's Information Morning Fredericton that financing Holt's planned agenda, while keeping budgets balanced, will be a dilemma the new premier is likely to face early and often.
"There were some questions in the campaign around how much some of these promises are actually going to cost and whether or not it will lead to deficits," Crandall said.
"So I think it's going to be that combination of need to deliver on big items but also you have to keep a balanced budget, and that's going to be really challenging."
Those challenges are already beginning.
According to New Brunswick's Finance Department, the province already slipped into a deficit position for the current year earlier this spring, and on paper it is not clear where the $74.3 million needed for the nurses' bonuses will come from.
Prof. Gabriel Arsenault said he is not aware of any government anywhere that has been found to keep all of its election commitments, and he doubts the Holt government will be able to be any different.
"I've never seen it. I've never seen that," said Arsenault, a political science professor at the Université de Moncton.
"Theoretically, she could fulfil all of her pledges but realistically, I don't think that will happen. It just never does."
Arsenault set up a New Brunswick polimeter during the Blaine Higgs government.
Polimeters have become common in North America among political scientists to track how many promises political parties make at election time and how many of those are eventually kept.
Arsenault found the Higgs government broke 29 per cent of its election commitments, and he is now preparing to track Holt's government. He has developed a list of 73 commitments made during the election that are potentially breakable, a condition for being included in the evaluation.
Arsenault said there is a definite "tension" in the Holt government's commitment not to run a deficit as it introduces what he calls a series of bold initiatives to try and solve various health-care, education and affordability problems.
He also thinks the party has underestimated what some of its signature commitments, such as establishing a universal breakfast and pay-what-you-can lunch program in all New Brunswick public schools, will eventually cost.
"There's a lot of uncertainty concerning the cost of many pledges," said Arsenault, who added that he found a number of estimates used in the platform unconvincing.
That appears to be the case for the school food program, which is estimated to cost $101.4 million over four years in the Liberal platform. That figure is based largely on out-of-date numbers lifted from a similar program being run in Prince Edward Island.
Two years ago, the P.E.I. program was serving an average of 3,500 meals per day, which is the number the Liberals extrapolated from to make their estimate.
However, more current numbers show that last year, usage of the P.E.I. program had grown 40 per cent, to 5,000 per day, a number that suggests a similar program in New Brunswick would be significantly more popular and expensive than the incoming government is counting on.
There is a similar problem with old data used to price out another commitment to offer unpaid family caregivers of seniors a $250-per-month benefit. The party used a 2018 evaluation of how many people would access a benefit like that to price it at $102.4 million over four years.
However, New Brunswick now has thirty per cent more people over the age of 70 than it had in 2018, a fact likely to drive costs of that program higher, as well. In addition, a simple math error committed in pricing out the same commitment lowered its cost by a further $4 million.
"If you look at her estimates of her various pledges, you will see that it is often close to being a shot in the dark," said Arsenault.
For the moment, the incoming government is not focusing on those issues.
A spokesperson for Holt's transition team said it is too early to talk about what might happen if financial commitments made during the election start to come into conflict with the secondary commitment to avoid deficit spending.
"That is a difficult hypothetical question As we are in transition discussions with departments, it's not a question we can speak to at this time," the email said.
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