Wednesday, May 03, 2006

Little to cheer for B.C. in budget

VICTORIA - Finance Minister Carole Taylor was quick to offer enthusiastic support for the federal budget.
It’s a little hard to see why.
The quickness was understandable. Radio reporters are always looking for fast reaction for their next newscast and the two Caroles - the NDP’s James and the Liberals’ Taylor - were ready to deliver first opinions an hour after the federal budget was released.
But the support was a little harder to fathom. On balance the federal budget seemed to merit a best an OK rating from the province’s perspective. Some good news, some bad news and nothing defining either way. (That’s not surprising from the first budget from a spanking new minority government.)
Start with the most obvious good news. The budget includes $400 million over two years to deal with the pine beetle crisis. That may not be enough, but it’s a welcome start and an improvement on the $100 million a year coming from the former Liberal government.
There are still a lot of questions about how the money will be used, especially in helping communities prepare to cope the post-beetle crash in the timber supply. But the money is a welcome downpayment on what is needed.
Taylor also praised the Harper budget for maintaining the Liberals’ promise of $591 million for the Pacific Gateway project, a major effort to improve transportation - road, ports and the rest - to help build trade with Asia.
But the Liberal government had promised the money over five years, working to a timetable that reflected the urgency of seizing trade opportunities.
The Harper government has pushed the commitment out over eight years, a significant watering down of the commitment.
Then there’s the bad news.
The biggest disappointment for the B.C. government is the Conservatives’ repudiation of the Kelowna Accord on First Nations. Premier Gordon Campbell travelled the country to win support for the agreement, which committed $5 billion over five years to improving conditions for natives across Canada. He championed it as a moral and economic obligation to end a shameful situation. The deal won the unanimous agreement of premiers and then prime minister Paul Martin in Kelowna last fall and was supported by First Nations leaders.
And the Conservatives blew it up within 90 days. The accord promised about $1 billion a year to improve housing, education and social conditions for First Nations. The Harper budget has committed less than one-quarter that amount.
The Conservatives complained that the Kelowna Accord lacked substance and was simply an attempt to throw money at a problem. That’s a serious rebuke to the Campbell government and setback for dealing with a national disgrace.
(The decision drew quick fire from First Nations’ leaders. Chief Stewart Phillip of the Union of BC Indian Chiefs said it showed the Conservatives couldn’t be trusted - he actually accused them of speaking with “forked tongue.”)
The budget also failed to provide any money to cover Olympic construction cost over-runs.
The cost of Games venues is forecast to be $110 million over budget. The B.C. government has already agreed to pick up half the extra costs.
But despite a big lobby effort from the Vancouver Olympic Organizing Committee, Ottawa hasn’t said it will contribute any more money.
If it sticks with that position B.C. taxpayers could be squeezed for more cash. (B.C. has agreed to take responsibility for all Games cost over-runs or revenue shortages.)
Taylor said she’s confident the federal government will come through. Trade Minister David Emerson is responsible for the file, she said, and understands the seriousness of the issue.
But if he does, where’s the money?
Details of the budget - good and bad - are still to come. The Conservative plan offers a vague indication of an army presence in B.C., which could offer benefits to a community. There are details of specific provisions for targeted industries still to come.
But so far this looks mostly like an adequate budget for B.C. There are few reasons for cheerleading.
Footnote: James seized on the expected lack of child care funding as a significant problem. The Conservatives’ decision to cancel the federal-provincial child care deal in favour of a $1,200 child allowance was expected, but it leaves B.C. without a clear plan for child care.

Perfect storm battering tourism; aid needed now

VICTORIA - The NDP was asking about BC Ferries Monday, but missed the most urgent questions.
BC Ferries wasn't their first choice. The New Democrats were keen to ask about emergency room problems, but neither Health Minister George Abbott or Premier Gordon Campbell showed up in the legislature.
So the opposition turned to the sinking of the Queen of the North. The questions were fine, about fare increases and environmental damage and whether BC Ferries should should keep getting paid a subsidy for the route now that it's not delivering the service. But they missed the big issue.
The sinking of the Queen of the North and the drastically reduced service for this summer are a tourism disaster for Prince Rupert and northern Vancouver Island.
And their impact is going to be felt across the entire province.
In the past that would have mattered less. The tourism industry was strong enough to handle even a serious problem like reduced ferry service on a key route.
That's no longer true. Tourism is getting clobbered by a storm of bad news. Start with the Canadian dollar, which topped 90 cents US this week for the first time since 1978. Three years ago our dollar was worth about 70 cents US.
Good news if you're heading to Seattle. Bad news for B.C. tourism.
An American tourist looking at a weekend in B.C. might plan on spending $400 Canadian. Three years ago that would have cost him less than $300 US. Today the same trip would cost him $375 US. That's the kind of increase that makes people think twice. Then consider gas prices. Three years ago gas was about 70 cents a litre. Now it's $1.12. Add the effects of the rising dollar and a driving holiday in B.C. that would have cost an American tourist $190 for gas three years ago would now be $385. (BC Stats estimates that each one-cent increase in U.S. gas prices results in 6,000 fewer tourists. American gas prices are up 55 cents from a year ago, enough to cost the province 330,000 visitors.)
On top of those problems add confusion about the U.S. government's coming requirement that American travelers have a passport. Only about 30 per cent of Americans have passports, and few are likely to get one for a brief trip to our province.
And now BC Ferries has slashed service from Port Hardy to Prince Rupert. A few years ago we did an RV trip from Prince George to Prince Rupert, and then down on the ferry to Port Hardy and home. It was early fall and the trip was spectacular. Most nights we met tourists from Europe, doing a big loop out of Calgary in rented RVs.
The threat of cancelled sailings is enough to make tourists consider other options. The effects will be felt from Nelson to Nanaimo.
The problem is already with us. Visits from the U.S. - by far our major international tourist market - fell 4.6 per cent last year. The number of U.S. visitors in February was the lowest of any month in 25 years.
Government can't ride to the rescue every time an industry hits hard times. Aid often just delays needed adjustments.
But the tourism faces extraordinary challenges. There is a role for government aid.
To its credit the government has sharply increased tourism funding in recent years, doubling support for Tourism B.C. to $50 million a year and providing one-time grants to the six regional tourism authorities.
A one-time emergency grant now now could help the industry through this year.
Tourism BC and the regional authorities could decide best how to spend the money. But a campaign aimed at assuring tour operators that the Rupert-Hardy trip is still possible would make sense. So would efforts to attract more visitors from within Canada, or encourage Americans to visit before passport rules kick in.
It's a good time for the government to land a hand to a key industry.
Footnote: The NDP questions on BC Ferries focused on whether the supposedly independent corporation would be docked money for failing to provide service on the route. Maybe, maybe not, said Transportation Minister Kevin Falcon. The reality is that penalizing the corporation would just mean higher fares for users.

Monday, May 01, 2006

New class size law a reasonable compromise

VICTORIA - Hey, the system works. Look at the government's move to set class size limits.
The Liberal government is in the process of bringing back size limits for Grades 4 to 12. It has acknowledged that eliminating maximum class sizes was a mistake. Too many children were lost in large classes.
That's a win for the students and for the BC Teachers' Federation, which went on an illegal strike last year at least partly over the issue.
The strike worked. The government had steadfastly maintained there was no problem with class size. That was contradicted by Industrial Inquiry Commissioner Vince Ready, who said the issue had to be addressed. And now the Liberals - to their credit - have admitted they were wrong.
At the same time the BCTF didn't get all that it wanted. Class size limits used to be in the teachers' contract. The Liberals used legislation to break the agreements. Class sizes and the number of special needs students were educational issues to be decided by trustees, they said.
The problem is that they are also workplace issues, which are usually subject to collective bargaining.  
The union would have liked to see the class sizes back in the contract. But this is a reasonable compromise. Teachers get influence, if they can keep the public's support.
The government refused to do anything about the issue until last fall's strike. Its interest appeared to be waning until negotiations with the union reached a critical point this month. That's when the legislation was introduced.
It was a pragmatic move. The BCTF is the last significant public sector union without a contract. The government wants to negotiate a deal without job action, especially after last year's strike. The public's support for the teachers did much to shape the government's new, more moderate approach to labour relations.
Partly, the union won support because the public had just grown tired of the government's rough treatment of its employees. People were prepared to tolerate some righting of the union-management balance after the NDP years. But after four years time had run out on tolerance for union-bashing.
The BCTF also made the strike about class sizes as well as about wages. It's an issue much more likely to attract public support.
The legislation pretty much takes that option away as teachers bargain a new contract. BCTF head Jinny Sims accepted the class size legislation as "a small step" forward.
Now contract talks will be largely about money. The union is apparently seeking something above 20 per cent in a three-year deal, citing the need to keep up with Alberta and Ontario. The government is looking for am agreement by June 30 that would match the rest of public sector deals - about 11 per cent over four years, plus a $3,700 signing bonus. The public is not likely to be onside if the BCTF demands more than other public sector unions. Sounds like good news for everyone, right?
Not for school trustees, and perhaps not for some students. The old regulations let districts have some large classes from Grade 4 up as long as the district average was under the cap. Now with the new law districts will face strict limits. That means some larger classes will have to be split and districts will have to hire additional teachers. But while the government is passing the law, it's not providing any more money to to school districts. They face increased costs and fixed funding; some other area will suffer. The problem will be especially serious for rural school districts, which will have fewer chances to shuffle students around to try and stay within the new limits.
It's far from a perfect outcome.
But class sizes have been addressed, as the union wished. The decisions have been made outside collective bargaining, as the government wished.
Students won't face extremely large classes. And a strike is now less less likely.
Score one for this democracy thing.
Footnote: The new law also deals with special needs students. Until 2002 classes with special needs students were required to have fewer students overall. The new law sets a soft limit of three special needs students per class. Advocates fear this will mean special needs students are shuffled around.