Public will quell opposition's bluster

Budget MJF - baisses d'impôts

Only in Quebec could the prospect of a $950-million tax cut induce the opposition parties even to muse about forcing a new election. But last night both Action Democratique and the Parti Quebecois were rattling their sabres and vowing to toss Premier Jean Charest's government out of office.

Yesterday's budget, presented to the National Assembly by Finance Minister Monique Jerome-Forget, had as its centrepiece the $950-million tax cut which Charest promised during the election campaign, and again when his cabinet was sworn in. It's a tax cut which all parties have been proposing, with various conditions and varying degrees of sincerity, for years.

But now, in the overheated political atmosphere generated by the recent PQ turmoil and a couple of snap polls, both opposition parties have positioned themselves against a budget which really is what Jerome-Forget said it is: disciplined, transparent and forward-looking.

This weekend, members of the National Assembly will go home to their ridings, and there the opposition members should hear from ordinary voters a message which, we expect, can best be summed up as "are you crazy?"

Instead of a tax cut of hundreds of dollars per family, the opposition ostensibly proposes to plunge Quebec into another $70-million election. This high-stakes game of chicken demonstrates not any degree of common sense, but rather the inexperience of all parties in dealing with the realities of minority government, which is unknown in living memory in Quebec.

Who can believe that the ADQ caucus, whose members are still accepting congratulations on their individual victories, will want to abandon their new jobs and roll the electoral dice again. Who can imagine that the PQ, in internal turmoil and flat broke, really wants another election. On the other hand, who can understand why the Liberals failed to nail down the support of at least one opposition party by means of some prudent spending compromises?

The Liberals would be in a good position to defend this budget in a new election, if it does come to that. Apart from the tax cut, there are many other things to like in Jerome-Forget's first budget, which was made easier to write by the money that dropped like a gentle rain from Ottawa just before the March election:

There is undoubtedly a public appetite for tax cuts. True, only a dwindling majority of working-age Quebecers actually pay income tax, but those people have been victimized long enough. Gilles Taillon of the ADQ seemed more than faintly ridiculous yesterday, complaining about the tax cut. True, debt reduction and endless spending needs could have absorbed the money, too. But overtaxed Quebecers have in recent years watched other provinces cut taxes, and are gasping for air. After years of dodgy accounting methods that allowed the public debt to swell even though finance ministers babbled about "deficit zero," Jerome-Forget promised consultations with the auditor-general to end this dishonesty soon. Meanwhile, the government has embraced the notion of hydro-power exports as a lucrative cash cow for the "generations fund" that is intended to balance off the public debt.

True, the debt will climb again this year, but a truly balanced budget came closer yesterday.

After years of underfinancing of universities, Quebec will now allow tuition fees to rise, as promised, while enhancing loan and grant programs. We wish this budget did more for universities, but this is a step in the right direction.
After years of a brainless, damaging tax on capital, Jerome-Forget said she will abolish it by the end of 2010. In effect, it vanishes immediately for manufacturing companies that invest in modernization.

After years of crumbling infrastructure - from decrepit schools to a collapsing overpass - this budget raises spending for "investments in preservation of fixed assets" by an impressive 32 per cent, to almost $3 billion.

After years of growing government spending, this budget does increase program spending again, by about 3.9 per cent. But 98 per cent of the growth is in health - up six per cent - and education - up five per cent. Who can argue with those priorities?

In that context, yesterday's other big announcement, too, seems timely. The health department now accounts for 44.3 per cent of program spending, a figure that is rising inexorably. Everyone knows the system is creaking and cracking under growing demand for costly procedures, care and medication. "How do I finance the system over the long term?"
Jerome-Forget asked rhetorically yesterday. She hopes the answer will come from Claude Castonguay, an old war-horse brought back into harness as head of a non-partisan study. This could open the door to bigger changes and Quebecers and other Canadians, including MPs in Ottawa would watch his study group with great interest, not least because its mandate includes examining "changes that might have to be made to the Canada Health Act."

This budget would not solve all of Quebec's public-finance problems, but in the minority context, given the depth of the fiscal hole we're in, Jerome-Forget is at least starting to build us a ladder.

This budget deserves to pass, just as the Liberals deserve a chance to govern. The opposition parties need to listen to the public a little, and allow this budget to pass.

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