CANADA

Hard times budget

June 22 1987
CANADA

Hard times budget

June 22 1987

Hard times budget

Scrawled in black spray paint across the vacant and boarded office building in downtown Regina is the blunt message “Tory times are tough times.” It is an inscription that seemed increasingly poignant as the Conservative government prepared to table a long-overdue budget this week that will almost certainly contain sharp tax increases and deep spending cuts. After five years of free spending, Premier Grant Devine’s government has embarked on a tough-minded course of restraint, determined to bring Saskatchewan’s $1.2-billion annual deficit under control. It has already eliminated more than 2,300 civilservice positions—and critics claim that even more draconian action is planned.

The cutbacks have triggered widespread unrest. But until Devine announced last month that the long-delayed budget would be introduced on June 17, public opposition was fragmented and ineffective. Now, with the budget as a target, about 50 organizations have formed a coalition to march on the legislature on June 20—three days after the budget—and to protest the cuts. Said coalition spokesman Keith Philander: “We’re not saying the province is not in trouble, but we say cutting everything is no way to attack it.” Although the new budget will provide a focus for antigovernment sentiment, it is not likely to contain many surprises. After Finance Minister Gary Lane announced in March that collapsing oil, potash and wheat prices and overspending had created a

$1.2-billion deficit, the government set a target of cutting the deficit by $800 million in the new budget.

Last week the Tories altered the 12year-old prescription drug plan that provided free prescription drugs to all citizens. Now, individuals will be required to pay the first $125 each year and then 20 per cent of costs above that amount. Lane has also increased the provincial flat tax on income from one per cent to 1.5 per cent, and he openly speculated that the five-per-cent provincial sales tax might be increased.

Lane said that the actions do not signal a rightward shift by the government. He added: “If anyone is looking for a philosophical base to this, there isn’t one. It is very much economically driven.” Still, a political undercurrent runs through the government’s strategy. The Tories delayed recalling the legislature, and since the new fiscal year began on April 1 they have financed government operations through special cabinet-authorized documents. By introducing the budget at the start of a rare summer session of the legislature, the Tories clearly hoped that public attention would be kept to a minimum.

Cuts in government funding to schools, hospitals and municipalities have already affected many social programs. The Saskatoon-based Native Court Worker Program, for one, which offers legal advice and assistance to native people, lost $836,000 in government money. As a result, the 11-yearold program is scheduled to end on June 30—despite an increase in the number of people it has served to more

than 27,000 in the last fiscal year from 11,155 four years ago. “I guarantee there will be more native people going to jail,” warned program administrator Arliss Dellow. “This may save a few bucks in the short run, but over the long haul it is going to cost the government a lot more.”

There is no agreement on the cause of the government’s financial dilemma. The Tories inherited a $136-million budget surplus in 1982—and they have turned that into an accumulated deficit of $2.7 billion. Devine and Lane have argued that Saskatchewan’s depressed farm economy and falling resource prices are responsible for lower tax revenues and higher government costs. But NDP members claim that the Conservatives unwisely slashed taxes when they took power—including eliminating a tax on gasoline, which cost the provincial treasury $600 million. Insisted NDP finance critic Ed Tchorzewski: “We are in this situation because of conscious revenue decisions made by this government.” Aggravating the problem were popular but expensive programs introduced during last fall’s election campaign. Despite omens of a troubled economy, the government launched a five-year, $282million home renovation program and offered low-interest loans to farmers.

The gasoline tax was widely ex-

pected to be reimposed in the budgetsignalling a final retreat from the Tories’ tax-cutting agenda which formed part of the platform that helped defeat former premier Allan Blakeney’s NDP government in 1982. Coincidentally, the NDP will hold its annual convention in Saskatoon two days after the budget is brought down. Blakeney has said that he plans to retire after 17 years as leader, and the weekend meeting will be a prelude to a leadership convention—possibly next fall.

Former attorney general Roy Romanow is considered the undisputed front-runner for the leadership. Romanow returned to provincial politics in 1986 after a four-year absence and retains widespread support in the NDP caucus. But the federal NDP is also pressing Romanow to join its slate in the next campaign, an option he is seriously considering. It is a prospect that became even more compelling with the release of a Canwest Opinion Research poll this week which showed the federal NDP with the support of 50 per cent of decided voters in Saskatchewan, compared with 29 per cent for the Tories and 21 per cent for the Liberals. But with the provincial Conservatives also embattled, Romanow’s choice will be a difficult one.

— DALE EISLER in Regina