Excerpt from the Official Report of


July 4, 2013

Budget Debate: Remarks on the 2013 provincial budget

S. Simpson: It's a pleasure to join the debate on the budget. I've had the opportunity to do this a number of times since first being elected in 2005, and it's always an interesting debate around budget matters.

I'd like to start, really, with a few thank-yous. I think all the members here all owe some debt of gratitude to the people that helped get us here in the recent election. I certainly want to thank the people who worked on my campaign — the members of my constituency association; the many, many volunteers who came and participated; and people from my community — to help me to return for my third term here in this place.

Obviously, it's a huge honour to be back here and to have received the confidence on three occasions of the people of Vancouver-Hastings. It's a huge honour to have the opportunity to be back and to represent those many people in my constituency who really do need the support and who have many, many issues that are in front of them, where they're looking for this government to take action that will make their lives just a little bit easier, to deal with just a few of those challenges that they face every day. It is a privilege for me to be here and be able to be part of that process of making that case on their behalf.

I want to, obviously, thank my family for being supportive over all these years of my time here. As we all know, it's challenging for families, for members. We all owe gratitude to the members of our family and our loved ones who tolerate what we put them through by being members of this place and by carrying out our responsibilities and our duties.

In regard to the budget itself, I have some clear objectives, sort of, for what I would like to see happen as we move forward here. They're objectives that I've embraced for a significant period of time in terms of what I think we need to achieve here.

We need a dynamic economy, an economy that's built on the creation of jobs, an economy that really is driven by jobs. That's an important consideration. That's something that we need to attempt to achieve.

We need to pursue increased equality in our province. We have dramatic levels of inequality in this province. We have dramatic challenges in this province that we need to overcome. We have poverty levels that are unacceptably high — poverty levels that have continued, year after year after year of this government, to be unacceptably high, particularly as it relates to children. We need a poverty reduction strategy that addresses that. We have not seen that strategy here.

We also need to be able to address just those challenges of equality for working families, who see increasing pressures on them to be able to make things work, to be able to make their own financial situation work. We simply aren't seeing that here, but that has to be an objective.

The third piece that clearly has to be an objective for us is the sustainability of all of the initiatives here. We know, of course, that as we move forward this economy, the reality is that we are going to be continuing, as a resource-based economy, to be exploiting those resources, sending those resources out, doing that work.

But we need, clearly, to have a plan that is sustainable and a plan that takes us down the road over the next years and maybe decades and leads us towards a different kind of economy — a green economy, an economy that is less dependent on fossil fuels, more dependent on renewables. We need to get there. We need to be able to show that we're making real progress in that direction to satisfy the expectations of the people in this province.

We, at this point, don't have that strategy from the government. For all the buzz, for all the rhetoric, we don't see that strategy in the government. We need to do that.

The other thing that is a reality here is that we do need to manage costs. We know the fiscal pressures that are on governments. We know what the fallout is of 2008 and the international situation that occurred then. We know the situation that provinces face now. We know that we need to address those matters of managing costs.

So in response to that and this government…. The government, to its credit, ran an election around jobs and around debt management and a number of things — all things that are good issues. The question is: how well have they really done on accomplishing those things?

What we have as a reflection of that is we have the current budget, this budget which is essentially, I think — as was pointed out by the Finance Minister — the reintroduction of the February budget. It has been put forward. So let's look at how well the government has done in dealing with some of the real challenges that we have faced in this economy.

First of all, we've seen the economy tighten up. The economy has continued to slow. We continue to have challenges. We've seen GDP growth go down from 1.6 to 1.4 percent over the period from February to June. We've seen employment growth drop from about 1.1 to 0.7 percent over the same time. Retail sales have been cut in half, from about a 3½ percent growth rate to about 1.8 percent, and we've seen a drop in housing starts as well.

All of those pressures, of course, have led to the Finance Minister making some adjustments to this budget, adjustments that will lay out a claim for the core review to find $130 million of cuts over the next period of time. We don't know what that really means, but that's the claim. We'll talk about that a little bit in a minute.

We've also seen a tightening in terms of what the surplus claimed by the government is — that it's going to be smaller. We'll talk about that in a minute and as to whether that surplus is real.

But what we have here in this budget…. The foundation of the budget, the foundation of many of the claims the government has made to deal with the budget, is that there is a plan here on the part of the government. The government has based this on a couple of key initiatives.

One is on a jobs plan. That's been a foundation of the Premier and a foundation of this government as they've tried to move forward. Yet we know, when you look at Statistics Canada, that the government of British Columbia has failed, probably more miserably than any other government in the country, on private sector job creation — failed more miserably.

Here in British Columbia we have seen the loss, between September 2011 and May of 2013 — the period of time, generally, that the Premier has been in office — of 31,000 jobs in the private sector in this province. When we compare that to the provinces that we tend to compare ourselves to the most — Alberta and Ontario tend to be the provinces that we compare ourselves to — in that same period of time we saw an increase of almost 54,000 jobs in Alberta in the private sector and 106,000 jobs in Ontario — private sector jobs.

So we've seen a dramatic difference in how the provinces have responded around job creation. This is very troubling, especially for a government that claims a jobs plan, claims that that plan has some modicum of success when we're seeing tens of thousands of jobs disappearing in our economy.

As a result of that, it probably should come as no surprise to British Columbians that, in fact, we're seeing an out-migration of people in British Columbia. Since 2011, since the Premier took office, over 10,000 more people have left British Columbia than have come to this province, and they've left British Columbia because they have lost hope. That's a reality. They have lost hope. You can probably follow that back and track that back to tens of thousands of jobs disappearing. Many of those people, their families, were hoping that they would, in fact, be able to stay here and work.

So we have this issue around the jobs plan — serious questions — since we have, it appears, the only jobs plan in the country that bleeds jobs more quickly than it creates them.

The other claim, of course, that the Premier has made, in particular, is the debt-free claim. I'll give credit to the governing side. This was a pretty effective argument — not based on any facts or evidence or reality, but a pretty effective argument during the recent election campaign. However, the problem we have is that when the Premier took office we had provincial debt of just over $45 billion. By 2016, based on the B.C. budget numbers, we will have a provincial debt of about $70 billion. That's a $25 billion increase in our debt in five years.

Now, however you might want to square that circle, it is simply unbelievable that a government and a Premier, who day in and day out espoused some notion of responsibility on debt, are increasing this debt at record levels that we have never seen in the history of this province. We have the most fiscally irresponsible conduct, based on this budget, that we have ever seen in this province and a Premier who clearly is out of control in terms of controlling our debt. That's a reality.

We have a debt problem. We have jobs disappearing. We have debt escalating. So what are we getting right here? Well, we have a government that claims a balanced budget. Now, we know, of course, that over the period of time that the government has been in power, 2001 to 2012 — 11, 12 years, whatever that period of time is there — seven deficit budgets. More than half the budgets that the Liberals have introduced have been in deficit. That's a reality: deficit budgets.

We have a government here that…. In fact, since Premier Clark has been in office, deficit targets have been missed by an accumulative amount of about $1 billion dollars. That's what the Premier has missed her targets by. We have a balanced-budget law. It gets broken pretty much on a regular occurrence, so much so that the pundits and others kind of make fun of and jest about the balanced-budget law — that it gets broken so often.

Now we have Budget 2013. Budget 2013 is apparently about a balance. But what's the reality of that balance? The reality is you have a sale of assets that is the foundation of this balanced budget — a sale of assets that is going to be critical to be able to make this happen, the government claiming that they will sell, if all is said and done, somewhere in excess of $600 million of assets.

Now, the thing to understand is that governments buy and sell assets all the time. There's nothing new, nothing special about that. But in the ten-year period, the first ten years of this government, just under $400 million of assets were moved by this government. Fair enough. Now, somewhere in between 2013 and 2015, in order to make the budgets work, the government has to move in excess of $600 million of assets. So over a decade, less than $400 million; in a couple of years we've got to move over $600 million of assets.

First of all, it makes you wonder whether it actually makes any sense in terms of responsible governance to be unloading assets in that way. Second is whether you can really get value for money if, in fact, your objective is to have a fire sale to try to deal with these shortfalls in the budget to get to a balanced budget, because the Premier has told us she's going to balance four budgets in a row. We'll see.

We also know that there have been significant reductions in terms of spending projections. Before the February budget, in the previous budget to that, what we saw…. And for people who are watching, of course, governments project out three years of spending in a budget.

In the budget prior to February, the projections were for growth of over 3 percent in health care, as an example. We were going to have growth of over 3 percent, and that was growth that reflected population, demographics and inflation — basically covering costs.

We now see a growth projection that is significantly less than that, projected to be…. The value of the differential is almost a quarter billion dollars, about $230 million less in terms of projected spending in health care because of this reduced growth. Yet the government tells us this can all be done without an impact on services.

The question clearly becomes — and maybe we'll find this out in estimates; I guess we'll see — where does the $230 million come from? What was going to be spent a year ago in projections — that we're going to absorb that $230 million from — that won't be spent now? What are those items? What is that going to be? Are there revenue streams to make that up? Is that what the wheelchair tax is all about? I don't know, but I guess we're going to get a chance to find that out.

We also know that in some areas…. We've heard about forest health. We've heard about reductions in spending in forest health. It's a significant issue. The forest industry continues to be a critical part of our resource base, but we need to deal with forest health. We're not seeing it. We're seeing a reduction in spending there.

We're seeing a cut in post-secondary — a real cut in post-secondary — at a time when everybody is acknowledging skills and skills training as one of the critical competitive edges that we need to embrace and that we need to advance. It just makes no sense to reduce that spending in that area when you know that's a place where you need to invest. But that's the reality that we see in terms of this investment.

So we have funding for services going down over what was projected just a year ago — funding for services being reduced. What we require now is an explanation of how that will impact those services, but there has been no explanation at all. Maybe we'll get that in estimates. I guess we'll see.

We have an asset fire sale that is unprecedented. I guess the first question is: could you even sell all those assets for a reasonable price? The second issue is: is it really responsible financial management to use asset sales to try to balance your budget? Is that really responsible financial management? You know, do you sell your furniture to pay your mortgage? Maybe in this case you do. But we'll see.

Then we have a government that claims it is going to be debt-free sometime in the future that is going to have set record levels of increases in debt by the time we get to 2016 — record levels. So $25 billion is going to be this Premier's claim to fame for her first five years in office, that she drove up debt by $25 billion in five years. That will be her biggest claim to fame.

Now, the other thing that the government has said it will deal with here is finding this $130 million through the core review. There's a minister who has been appointed to deal with the core review, yet we have no commitment on transparency as to what this review is going to look like. The minister has yet to tell us that he, in fact, will release the information about what the plan is. It's supposed to go to priorities and planning of cabinet, I believe, by the end of August. What's that plan going to look like? How are those decisions going to be made?

What is the role that this review is going to play? We've asked: is this going to review services? We can know that the Minister Responsible for Core Review has previously been critical of the fact that reductions in support in the resource industries have meant that permitting hasn't happened fast enough to be able to meet the needs of the industry when they're moving forward on resource business.

We know that the Representative for Children and Youth has expressed serious concerns about the current levels of support for children and families. But there's no reason to believe this review will look and say: "We in fact can't meet our objectives, and new resources are required there to deal with that."

Of course, we know that there are other initiatives that are moving forward where we should be looking at whether they receive the levels of support to deliver the levels of desired programs or desired services that we have. But we see none of that. We are simply going to see cuts.

The core review isn't about quality of services. It's just about cuts. We'll have to talk to the minister over the next period of time, in estimates, to see what those plans are and to see, in fact, how broad this review will be. Will it review all of the communications staff that work for government? There are hundreds — about 350 if you tally everybody in. Are they going to be looked at? I guess we'll find out.

The problem, though, is this. You have a budget that is simply unbelievable. This budget is not balanced. It will not be balanced next year when we come to the end of the year. There's no doubt in my mind about that. This budget will not be balanced, but a lot of people will be hurt along the way in the effort to find that balance. A lot of people are going to be hurt.

I can't think of anything more irresponsible than a government that's attempting to balance a budget that they simply don't have the capacity to do, but they're willing to let a lot of people fall by the wayside in the meantime in this effort. It's unfortunate that the government has done this.

It's unfortunate that this is a government that seems to be prepared to govern on ideology and to have ideology be the foundation of decisions. Certainly, ideology is the foundation of this Premier's decision-making, and she, presumably, will be calling the shots. If there's one thing we know, ideological decisions are never the best decisions. Sadly, the people of this province are facing four years of a pretty ideological government.

We'll obviously be voting against the budget. We'll be looking to get more information in the estimates process. We'll see how successful that is. At the end of the day, come next year when public accounts…. When there's a settling of the accounts of this budget, I am sure the people of British Columbia are still going to see a deficit, and they're going to see a lot of people who got hurt along the way in the delivery of that deficit. With that, I'll take my place.


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