What’s a budget for, anyway?

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Finance Minister Tom Osborne used the words “methodical, fair and responsible” to describe the recent budget, but representatives of civil society and community organizations said that Budget 2018 failed to provide a vision for a sustainable future for Newfoundland and Labrador.

Debbie Forward, head of the Nurses’ Union, referred to it as “a flat budget.” She said while there’s not a lot to be upset about, there’s not much to be excited about either.

Mary Shortall, President of the Newfoundland and Labrador Federation of Labour said she was looking for a jobs strategy from the budget, but couldn’t find one. “There’s nothing in this that indicates there’s any plan ahead for that. I didn’t see a vision in this budget for what’s going to happen for our population going forward,” she said.

The March 27 budget “doesn’t inspire confidence with respect to what we have been able to observe today,” said Dr. Lynn Dwyer, president of the Newfoundland and Labrador Medical Association.

Though the province claimed to have used a gender-based analysis, people struggled to see how gender was taken into account at all.

“I know the Newfoundland and Labrador government said they did do a gender-based analysis but we do challenge that. Certainly we didn’t see that coming out in any of their economic policies,” Jenny Wright, executive director with the St. John’s Status of Women Council/Women’s Centre, said.

There’s not much thinking about the bigger picture, said MHA Lorraine Michael. “They’re just dealing with things, the here and now of what’s right under their nose and not looking at the bigger picture,” she said.

Osborne emphasized the most positive part of the budget—that it avoided severe cuts. Still, the budget was broadly criticized for doing little or nothing to: plan for a rapidly changing economy, reverse the province’s rising inequality, shrinking population, unemployment crisis and the challenges of providing services across the island and Labrador.

The budget that economist Alison Coffin wanted to see was one that responded to the needs of the people of Newfoundland and Labrador. “We really need to rethink how we’re going to generate our revenues and how we’re going to spend on things which are more in line with the needs of the population,” said Coffin, who is currently running for leadership of the provincial NDP party.

Forward, with the Nurses Union, said “I sometimes feel like it’s a ship heading into an iceberg and we got to turn the ship around.”

The province needs to set a course for a more jobs rich future, said economist Dave Thompson. “If the province wants to keep people, young families and young workers, they need some hope,” he said.

Jobs of the future?

If the budget is a future-building tool–as suggested by the new budget’s title, Building for Our Future–then what is the province building?

“A budget should really start with a vision for the future as opposed to what are the facts we have to react against,” said Dave Thompson, economist and a founder of PolicyLink Research Consulting, a B.C. organization providing advice to governments, labour organizations, and the private sector on economic and resource management issues.

The acceleration of the oil and gas industry in the province was a major feature of the budget this year. “We want to put a solid focus on the oil industry,” Osborne said.

The table of contents on page one of Budget 2018 The Economy mirrored Osborne’s focus, with no heading listed for renewable energies or post-oil planning. The list of headings, however, included the following sections: The Way Forward: A Stronger Economic Foundation; Oil and Gas, Mining, Manufacturing, Fishery and Aquaculture, Forestry, Agriculture, Construction, Real Estate and Tourism.

By 2030, Osborne said there could be over 100 new exploration wells drilled, with multiple basins producing over 650,000 barrels of oil per day. This commitment would maximize job creation, royalties and other benefits related to the industry, Osborne said. Osborne confirmed plans to break off the oil and gas division at Nalcor Energy and form a new Crown corporation.

When asked about planning for post-oil industries and renewable energies, Osborne pointed to Muskrat Falls as evidence of the province’s commitment to renewable energies.

Investment in diverse, renewable, post-oil energies is a jobs issues, said economist Thompson. Although the oil and gas industry will bring some jobs, many of them short-term, to the province, the new jobs of the future will be linked to renewable energies. That’s why the province should begin planning for the transition away from oil now, he said.

“There’s enough trends out there, that it makes transition really important in terms of bread and butter jobs issues.  It’s not just a fringe green kind of thing, it’s just reality. There’s good reasons to shift away from an oil and gas based economy, but there’s also just the bitter reality that it’s happening,” he said.

“We do need to have governments starting to say, what is the future really going to look like? And what are the jobs of the future? How can get ahead of that—and maybe even build an industry where we can have some exports? We can have a strong jobs economy at the same time as we have sustainability and fairness,” he said.

The province forecasts that the jobs market will remain weak, with employment falling by one per cent this year. While Thompson praised this budget for avoiding the types of extreme cuts that would make the province’s economic situation worse and for planning to bring down the deficit, he said the budget could have done more to address unemployment.

“It’s not a strong job creation budget either and I think that is what’s needed. The province does have about 15 per cent unemployment, which is crisis level. And if you add in all the people who have given up looking for work or they’re involuntary part-timers or people waiting for a job to come in, you’re getting up towards almost 20 per cent. And the forecasts for unemployment are not going down,” Thompson said.

Where was the gender-based analysis?

First of all, women’s advocates had been hoping for a task force on gender-based violence, said Jenny Wright, executive director with the St. John’s Status of Women Council/Women’s Centre.

“We had certainly hoped for a task force on gender-based violence. We’ve been calling for that for some time. And we heard nothing, so there was some real frustrations around that,” said Wright.

In his speech, Osborne said that the budget had used a gender-based analysis to guide their actions. “A gender-responsive budget acknowledges inequalities between genders and seeks to reduce these inequalities by implementing measures that directly aim to improve lives,” Osborne said. (Note that he didn’t say “aim to improve women’s lives.”)

Wright said she couldn’t find evidence of a gender-based analysis that works to improve women’s lives.

“I think to begin with what we really would have liked to have seen is a solid gender-based analysis. The start of what we’re seeing now coming out of the federal government and other provincial governments,” she said.

Wright said that the women’s policy office is “almost gutted” and doesn’t have the resources to do the kind of analysis that could effectively inform a provincial government.

“Who is doing this gender-based analysis. We simply don’t have the resources, the bodies in there, to do what would be a very comprehensive gender-based analysis about how women are disproportionately affected by some economic polices. Right now in this province, we have a gutted women’s policy office which is trying to deal with huge gender issues such as the highest  wage gap in the country, among the highest levels of violence, on what we feel is the equivalent of fifty bucks and a gas card,” she said.

Wright said there isn’t enough data available for a gender-based analysis. “And that’s simply because we don’t have the bodies in the back office to do that fundamental research that we need done,” she said.

“What we’d really like to see is a strengthened department, with some real strong resources in there under the minister responsible for the Status of Women, so that we can start doing gender-based analysis. Then we can really look at what is the situation for women in this province and how can we improve,” she said.

Women’s centres saw no increase in their funding, said Wright. Although she is happy to see the matching federal dollars in early childhood education, that “was part of any new gendered vision for our government,” she said.

What would a budget directed by a gendered analysis look like in this province? It would address issues including wage disparity, violence against women, cuts to healthcare, and childcare.

“The two big concerns that we have from a gender perspective right now is that we have the highest wage gap in the country. So we’re sitting around 66 cents on the dollar. Where Canada-wide it’s 74. I mean this is horrendous for women. This is locking women in poverty. We saw nothing coming out of that budget that was going to help or appease that. The other issue and it is very much tied is the levels of violence that women experience in this province. So we’re not seeing anything coming out to address that. Women’s organizations receive $142,000 dollars a year to do the work we do. So if you want to tackle the incredibly high levels of violence that we have that keep women in poverty, we need to have some real money come forward,” she said.

Post-secondary education: under review 

Students deserve a budget that prioritizes post-secondary education, said Canadian Federation of Students provincial chair Sophia Descalzi.

The $9 million cut to Memorial’s operating grant was no surprise. Neither was the tuition offset grant that helps maintain a tuition freeze for Newfoundland and Labrador students only.

“This budget failed to protect out of province and international students when this government themselves has recognized the importance of newcomers in this province,” Descalzi said.

Descalzi said she’d like to see the tuition freeze extended to all students, the elimination of the recently implemented fees for out-of-province, international, and in-province students, and movement toward tuition fee reduction and the elimination of tuition fees altogether.

“We believe that sharing the cost on a 50/50 model from the federal and provincial government is the best way to attain free education. We know it’s not going to happen tomorrow, we know it’s not going to happen next year, but it’s about starting that process. Taking those steps it will not only benefits students, but the entire province and the entire country as a whole,” she said.

In a communique to the university community issued by Memorial University following the budget, it was also noted that in late 2017 government informed Memorial it would no longer receive special payments to cover its unfunded pension liability. Talks are ongoing with the university’s unions about how to deal with the situation. Descalzi acknowledged concerns that this financial situation could lead to tuition and fee increases. Descalzi noted that despite the supposed tuition freeze for NL students, NL students were hit with hundreds of dollars’ worth of ancillary fees last year.

The one new announcement was a review of the post-secondary education system. Finance Minister Tom Osborne said they don’t have a mandate, terms of reference, budget or timeline for the review, but that it will encompass both Memorial and the College of the North Atlantic. Descalzi said there’s tremendous potential in such a review, but expressed concern that so far planning has excluded those with the most at stake—students.

The future of healthcare? 

Dr. Lynn Dwyer President of the Newfoundland and Labrador Medical Association said that she’s concerned about the fiscal forecast and future cuts to healthcare.

“We are calling on the provincial government to do an organized review of healthcare facilities and services here within the province, so that if there are going to be significant cuts to healthcare that it’s done in an organized fashion,” she said.

“Based on the numbers provided to us today in order to achieve that balanced budget we’ll be looking at a reduction of $448 million. With the healthcare budget currently making 40 per cent of the budget, we are potentially looking at a reduction of 180 million dollars based on the numbers provided today,” she said.

“We don’t want to see anyone hurt. What we want is that the patients in the province receive the best care that they can for the health care dollars that we have. What we don’t want to see are random short-sighted cuts made without long-term thought processes going into that. So what we want to see is a well-organized review of our healthcare facilities and services,” Dwyer said.

Debbie Forward, head of the Nurses’ Union, disputes claims from Health Minister John Haggie that there are enough health care employees in the province. During budget briefings he said the problem lies in the occupational spread of health care providers, rather than the numbers.

But Forward said the problem is more complex than that. She said the presence of more than 1000 nurses on casual status in the province is a problem; she also warned that attrition is removing vital health care providers from the system. She also said that the number of nurses reflects the challenges the province faces, including: an aging population, a dispersed population all around the coasts, higher levels of heart disease and diabetes.

“Our health factors in terms of how much we eat, how much we drink, how much we smoke, are the worst in the country. It’s no wonder we need more people to provide health care. And until we turn that ship around, there is just no way that this government can say we’ll try to get [numbers of] Registered Nurses down to a national average. It’s not possible. We have terrible health outcomes now and research shows that the more Registered Nurses you take out of the system the worse your outcomes are going to be,” she said.

The province needs to consider the impact of attrition on the long-term need for nurses, said Forward.

“So our numbers are declining, they’re not going up. [Government] talked about 5000 retirements coming up, and we’re going to have to be watching that because we’re losing people by stealth. You can’t take one RN out and expect the ones left behind to pick up that work and it not have an impact on the care given to patients. It’s not possible,” she said.

Dwyer and Forward both expressed concern for the future of healthcare in rural communities.  Dwyer noted that the salaried healthcare positions were cut by $6.5 million.

“As you  may be aware a lot of the salary positions here in the province of NL work in rural areas of the province so that could have a significant impact for healthcare in rural areas. Again the NLMA has not been consulted, has not been involved in any decision. So this came as completely new news to us. This significant cut to the positions services budget,” Dwyer said.

Common Front: Inequality is on the rise

After the severe austerity budget brought forward by the Liberal government in 2015, several civil society groups came together to form the Common Front. The coalition of labour, community and student organizations says that it represents over 100,000 Newfoundlanders and Labradorians. Chairperson Alyse Stuart said that this year’s budget does very little to reverse the social and community harms that were set in motion by government’s austerity initiatives, and does nothing to halt the growing inequality which plagues the province.

“We’re still seeing an increasing unemployment rate, we’re still seeing outmigration at significant numbers, we don’t see a real concrete immigration plan,” said Stuart. “There was a mention of childcare, which we applaud because we did mention to government to have childcare put into this budget, but again it’s piecemeal. There’s none of the big robust change that we need, and if we really want to move out of this situation, we need to think long-term and think about what those long-term goals really are. We’re just really not seeing that.

“Unfortunately in Newfoundland and Labrador, as is the case nationwide, the gap between rich and poor is increasing, it’s not decreasing. We see nothing in this budget that’s leading us to believe that that gap is going to be closed at all. There’s no talk of actual progressive taxation, which is what we’ve called for as well—taxing those high-income earners who have the disposable income to put back into our province. We’re not seeing any of those moves. And there’s still going to be huge inequality. Out of every ten folks that are born into poverty in this province, only one will ever leave that cycle of poverty. That’s a really concerning number.”

“People are falling through the cracks”

The message conveyed by Common Front was echoed by other civil society groups and community organizations in response to the budget. While they were almost universally thankful that there were no large-scale cuts—some even refused to comment, citing a fear they might lose what they currently have—there was also considerable dissatisfaction expressed at the lack of long-term investments to address the province’s glaring social problems: an unemployment rate that is staggeringly high compared to the rest of the country, rising inequality and costs of living, and service gaps lingering from the 2015 austerity budget.

Forward said that it’s important to look at the budget as a whole, and realize the impact that funding cuts in one area—for instance education, or affordable housing—can have on other areas, such as health.

“What good poverty reduction strategies do we have? What’s our strategies around employment, housing? Those are the social determinants of health. How does investing in education impact health? Those are the things that we have to really start investing in to make sure that people have the supports that they need to have a healthier lifestyle. It’s no good for me to say you have to eat healthier, when people can’t afford to buy healthy food. It’s no good for us to say housing is a predictor of health outcomes, where we’re not providing affordable places for people to live. So we have to start investing more in those types of policies.

“I sometimes feel like it’s a ship heading into an iceberg and we got to turn the ship around,” she said. “That takes investment in healthier living and education and unfortunately we’re not going to see the benefit of that investment for many many years. But we have to start somewhere.”

Mary Shortall, President of the Newfoundland and Labrador Federation of Labour, agreed.

“There’s a big difference from two years ago, obviously…but one of the questions I got out of the whole thing is—is there anything in the budget that actually works for those that have been left behind?

“We would have liked to have seen an increase in the minimum wage. We really wanted paid time off for domestic violence leave at work, in keeping with what’s happening with the federal government and provinces across the way. We had asked for occupational health and safety legislative changes around domestic violence as well, residential tenancies act changes, none of those appear to be there. So what’s in it for those who are more vulnerable?

“Government’s predicting that the labour force is going to decline, the participation rate is declining, unemployment is going to be at 15.1 percent when the national average is 6 percent. If we don’t start putting money into the hands of people here, the economy won’t work for them. And we need to have a jobs strategy. We’ve been asking for a jobs strategy for a long time. There’s nothing in this that indicates that there’s any plan ahead for that.

“I didn’t see a vision in this budget for what’s going to happen for our population going forward…The people who are falling through the cracks, who are more vulnerable, the ones who are hurting right now—there’s nothing in this budget that tells me their lives are going to be any better for it.”

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