Print Edition: February 29, 2012
From what will surely be the hotly contested riding of Langley, NDP candidate Andrew Mercier sat down with The Cascade to discuss the larger points of the recent provincial budget. Mercier himself is a former UFV student.
Let’s start with students. The Where’s The Funding movement, which held an event on the back steps of the Parliament building to coincide with the re-opening of the legislature, was hoping to see more funding for Advanced Education. Where did the government fall with regard to students?
Well, I think where the government went wrong in regards to students is not prioritizing advanced education, at all – completely neglecting it to service their own narrow interests.
You can look at the budget, a line item in it is $15 million to advertise the government’s jobs plan, which is largely a plan to create jobs in the Premiers office, or so it seems. Right, their claiming credit for the Seaspan contract from the federal government, as well as several other things that seem to have happened fairly independent of them, but they’ve completely neglected the needs of students and skills training. And that’s going to become a major issue for us as the years progress.
As a former student that attained reasonably well in university, I graduated with first-class honors, 50 per cent of my wages right now go to debt. I mean that’s a very real issue that needs to be addressed and it’s not something I see coming from this government or this budget at all.
Families, a topic which will possibly be Premier Christy Clark’s legacy, how did they fare?
I don’t think Christy Clark will have any legacy to leave to BC families other than her hands in their pocket… Since 2001—and I’ll preface this by saying Christy Clark was a member of government from 2001 to 2005, she was a key minister under Gordon Campbell and she was the Deputy Premier—but MSP premiums have gone up 85 per cent since 2001 and what we see in this budget is another four per cent increase, because once again they have their priorities backwards. They’re engaged in some economic wizardry to craft a deficit cutting budget, but what they’re doing is they’re having a fire sale of government assets instead and they’re taking money from working families and small businesses.
New home builders were hurt by the HST as people laid off purchases until the tax rolled back to the PST system. With this budget, the government has brought forward relief in terms of increasing the HST rebate threshold for new home purchases. But is that enough to offset most of the problem effects that were caused in the mishandling of the tax?
Well, I think you are right when you say the problem with the tax is the way they handled it and the uncertainty around it. Who in their right mind would buy a new home now, when they know there’s not going to be HST applicable to it in, perhaps, 14 months.
So what they’ve done – and in the Fraser Valley the real-estate industry is very important – they’ve essentially crippled it. I was talking actually to a developer creating homes for Yorkson, who’s built 80 homes that he says are sitting vacant right now, new homes. And part of the problem here right now with this “new home rebate,” is read the fine print.
I don’t think any young couple, or anyone just graduating university that is going to buy their first home is going to buy a brand new home. Most entry level homes tend to be homes that have already been lived in. And so in that way it doesn’t address one of the fundamental issues. They need to scrap the HST. It took 12 months to introduce it, there is no reason they can’t get rid of it in 12 months. What you’re seeing is them trying to claw back the revenue from the HST to pay back the money to the federal government, because they signed a bad deal. It was a bad deal for British Columbia.
Healthcare is edging ever closer to half the provincial budget. How well did the government service that industry?
Well there are two things going on with healthcare becoming half of the provincial budget. One of them is in fact that the size of healthcare relative to everything else has grown because everything else has been cut back so harshly. Because since 2001 the government has cut spending in several other places, which has left healthcare – which still has grown as a cost – taking on an outsized portion of the budget. And I think there are a lot of very good empirical studies on that by the Canadian Centre for Policy Alternatives.
But they’ve done a poor job servicing the public of British Columbia in terms of healthcare. I mean they’re raising MSP again four per cent. People are getting healthcare in Tim Horton’s right now, we have Tim Horton’s healthcare in BC. And that seems to be what the Liberal policy is.
And it’s funny because if you look at the fire sale of assets that Minister Falcon is having right now, what you’ll see – it’s directly linked to their short term thinking in terms of healthcare. They’re selling a piece of land in Surrey that they bought up for the expansion of Surrey Memorial so that they’d have a place to expand it to. Now, the expansion is going ahead on another site so they’re going to sell that land to recoup that revenue.
But here’s the thing, Surrey is growing so fast that in 10 to 20 years it’s going to be the size of Vancouver, they’re going to need a new hospital, and they’ve sold the land they could have built it on, right. They’re not keeping up with the growth that’s there. And another part of the reason, just if you look at costs, they need to extend referential drug pricing. We pay 40 per cent more for drugs than Quebec and Ontario does because they drove a harder bargain than we did. And that’s a very easy thing to approach, especially when you look at one of the highest costs related to healthcare being prescription drugs, and non-prescription drugs.
The Auditor General report, which found that the government has failed in planting new growth for fallen trees due to the forest industry. Is there any new money to service that?
Well, what the government has done is they’ve failed to keep a proper inventory of the timber supply in British Columbia. I think the last inventory was done 17 years ago. So we have absolutely no idea how sustainable the forestry resource is right now, at all, which is completely unacceptable.
This is a government that has lost 35,000 jobs in forestry. They gutted the timber sale harvest license process, they got rid of pertinency requirements within the timber sales harvest licenses, and they’ve closed down 70 mills – or seem to have closed down 70 mills. So, that is something we can look at. We need to get a proper inventory done, it needs to be one of our first priorities – I think, in order to properly manage the resource.
Premier Clark’s much touted trades mission was aimed at increasing exports to Asia. Did this budget do enough to address continued growth in that direction?
Well I think what we’ve seen is Premier Clark tout photo-ops to Asia, rather than trade missions. I mean, let’s be frank here, I think the best two premiers for having good trade relations with Asia were probably Premier Bill Bennett and Mike Harcourt. We’ve seen [Liberals] consistently mishandle that because we need to build long, permanent, ties there rather than just go through once every once every couple of years and wave the flag around.
The government has made it clear that retaining their triple-A credit rating was a goal of this budget. But economically, do you think a mandated balanced budget – as the Liberals have done- is a good idea?
Well, the Liberals have crafted a balance budget law that they’ve broken. Now, they like to talk a lot about balanced budgets, but if you look through their past 10 budgets you’ll find that the majority have been run on a deficit. And that’s no one’s fault but their own when you essentially break the tools to generate revenue in government, like privatizing the liquor distribution board which brings in hundreds of millions of dollars of revenue into government coffers.
I think it would behoove us to be fiscally prudent. I don’t think we’ve seen a fiscally prudent government. I mean, the HST transfer money came to us in 4 payments that we continued to accept, even after we knew there was going to be a referendum on it. And both Premier Clark and Minister Falcon said they thought they would probably lose the referendum. They continued to take that money. I don’t think that’s a fiscally prudent move.
So, I think if we want to maintain our credit rating, we should act like fiscally prudent and responsible financial actors. Because, we need to not be afraid of decisions being made by 20-year-olds MBAs at Moody’s and Fitches because we’ve allowed ourselves to get to so much debt because of reckless government spending and failure to collect proper tax revenue, that we’re reduced to that point. If we want to maintain our credit rating, we need to be economically prudent. And they’re not doing that because they don’t have the fundamentals down.
According to the BC Government Employees Union, BCGEU, the Liberals are going to cut 2000 public service jobs over a three year span. Is that a likely figure?
Well, I mean we can’t really speculate until we see what the Liberals are actually going to do. I mean, they’ve talked about cuts. They said they aren’t going to privatize liquor stores, yet, but they’re going to privatize the liquor distribution board and the hundreds of employees, unionized employees, that work there. So, I mean, it doesn’t appear to bode well.
Are there any other specific measures in the budget you’d care to discuss?
Well, I think that the sale of assets is something we all need to be really concerned about. Because, once those are gone they’re not things that we can just bring back because it would take an intensive amount of capital to recreate a liquor distribution board, or anything like that, right. Essentially what the BC Liberal government is doing, what Premier Clark and Minister Falcon have done, is sell the house to pay for groceries. They’re trading away budgetary tools to raise revenue for one-time lump sum payments to mask their deficit ahead of the next election, which is the worst kind of politics.
Is there anything that the Liberals did right in the budget?
I think the Liberals fell short on many fronts. One of the things you could have potentially credited them with… let’s look at the reality of the budget. They’re raising MSP 4 per cent, they said that they would give small businesses a tax break – they failed to do that, they said they may raise corporate taxes if the situation merits it after having cut corporate taxes, slashed to one of the lowest rates in Canada successively over the past 10 years. And they might not do that until 2015 when odds are they’re going to be out of office. So anything they could have done on the revenue side, they failed to do, or came up with a tepid promise that they may do something at some point in the future.
This budget leaves a lot to be desired, and I think the average British Columbian would say that. There’s not a lot happening here that’s good for you or I. And the biggest thing they’ve failed on is students. They failed students. There’s nothing in there for advanced education, there’s nothing in there for student loan relief. They’re spending $15 million on government advertising, advertising their jobs plan. And I guess that’s something done right for PR firms, but it’s not something that’s done right for somebody that’s working their way through school, or for a population that takes out one of the highest student debt loads in the country.
If in power, what are some proposals that the NDP would have included?[A budget] that speaks directly to student needs. One of the things we would have done is we would have raised the capital gains tax on financial institutions back to 2008 levels, and use that revenue—approximately $100-million dollars—to make student loans interest free. Because right now the government of BC actually has the highest interest rate on student loans anywhere in the country. And it’s a revenue source. But it’s a very simple move we could do.
2008 levels are Liberal levels of the tax; they’re not scary or demagogic levels at all. Right now there is no capital gains tax on financial institutions. And if we reintroduce that, we should be able to recoup some revenue to make things just a little easier, just a little easier for student’s trying to put their selves through university so they can have a better life.
Overall, a good, alright, or bad, budget?
I think that this is a bad budget. I don’t think it serves the people of British Columbia, especially families. I mean, the only time you see families in this budget, and yeah there’s a lot of nice language around it, but any time it actually matters the government’s taking money out family’s pockets and giving it away.